Exhaustive tax entry interpretation and misuse of recognised goods justified penalty under trade tax law.

Penalty under Section 4-B(5) of the U.P. Trade Tax Act was held to follow where goods covered by a recognition certificate were used for a purpose other than that for which the certificate was granted; cancellation of the certificate was not a condition precedent. The entry of "iron and steel" in Section 14 of the Central Sales Tax Act was construed as exhaustive because the words "that is to say" limit the enumeration to the specified sub-clauses. On that construction, two-way cages were not covered by the entry, and the penalty challenge failed.

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Issues: Whether penalty under Section 4-B(5) of the U.P. Trade Tax Act, 1948 was justified for use of goods for a purpose other than that for which the recognition certificate had been granted, and whether the entry of "iron and steel" in Section 14 of the Central Sales Tax Act, 1956 could be given an expansive meaning so as to include two-way cages.

Analysis: Penalty under Section 4-B(5) is attracted once it is found that the goods were used otherwise than for the purpose for which the recognition certificate was issued. The absence of cancellation of the recognition certificate does not operate as a condition precedent to levy of penalty. On the construction of Section 14 of the Central Sales Tax Act, 1956, the expression "that is to say" confines the ambit of the entry to the goods specifically enumerated in the sub-clauses, and does not permit an expansive interpretation of "iron and steel". Since two-way cages do not find place in the enumerated sub-clauses, they cannot be treated as falling within that entry.

Conclusion: The penalty was validly imposed and the challenge to the penalty order failed.

Final Conclusion: The revision was liable to be dismissed because the assessee's use of goods for a different purpose attracted penalty, and the statutory entry for iron and steel could not be enlarged to cover two-way cages.

Ratio Decidendi: The expression "that is to say" in a taxing entry makes the enumeration exhaustive and restrictive, and penalty may be levied when recognised goods are used for a purpose other than the one for which the certificate was granted, without cancellation of the certificate being a prerequisite.

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