Common parlance test excludes P.V.C. rexine leather cloth from textiles, defeating entry tax liability.

P.V.C. rexine leather cloth was held not to fall within item 1 of the Schedule as "textiles" manufactured in mills or powerlooms. Applying the common parlance or trade parlance test, the Court treated the expression as covering varieties of textiles ordinarily understood in trade, not by reference to Central Excise tariff item 19. On the undisputed manufacturing process, the material was a coated or impregnated fabric rather than a woven textile fabric, and it also did not satisfy the requirement of being manufactured in mills or powerlooms. Entry tax was therefore not attracted and the proposition notices demanding registration, returns and tax were unsustainable.

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Issues: Whether P.V.C. rexine leather cloth falls within item 1 of the Schedule to the Karnataka Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1979 as "textiles" manufactured in mills or powerlooms, and whether the impugned proposition notices demanding registration, returns and entry tax were sustainable.

Analysis: The Act levies tax on the entry of scheduled goods into a local area, and section 2(B) adopts undefined expressions from the Karnataka Sales Tax Act, 1957. The Schedule entry was amended so that item 1 covered only varieties of textiles, including cotton, woollen or artificial silk and other man-made or synthetic fabrics, manufactured in mills or powerlooms. The decisive question was therefore whether P.V.C. leather cloth answered the description of textiles in its ordinary commercial sense and whether it was of the class manufactured in mills or powerlooms. The Court applied the common parlance or trade parlance test, noting that the expression was not statutorily linked to the Central Excise tariff and could not be expanded by reference to tariff item 19. On the undisputed manufacturing process, P.V.C. leather cloth was a coated or impregnated fabric and not a woven textile fabric understood in trade parlance as falling within item 1. The material also did not satisfy the further requirement of being manufactured in mills or powerlooms.

Conclusion: P.V.C. rexine leather cloth is not "textiles" within item 1 of the Schedule and is not exigible to entry tax; the proposition notices were unsustainable and the challenge succeeded.

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