Tax Tribunal: Sodi-bi-crab qualifies as tax-exempt grocery item.

The Tribunal allowed the appeal, determining that Sodi-bi-crab, also known as eating soda, qualified as a grocery item for tax exemption. Despite not being specifically listed as a grocery item by the Commissioner, the Tribunal considered its common availability in grocery shops and its usage in food preparation as sufficient grounds for classification as a grocery good. As a result, the purchasing dealer was entitled to purchase Sodi-bi-crab tax-free based on its registration as a grocery goods dealer. The assessment was reduced to the returned figures, and any excess tax collected was ordered to be refunded.

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Issues:
1. Whether the sale turnover of Sodi-bi-crab should be allowed as a deduction.
2. Whether Sodi-bi-crab can be classified as an item of grocery goods for tax exemption.

Analysis:
The appeal was against the Assistant Commissioner's order confirming the assessment for the year 1973-74. The assessee, a registered dealer in grocery goods, chemicals, and packing materials, sold Sodi-bi-crab to a purchasing dealer and claimed deduction based on the dealer's registration. However, the assessing officer assessed tax on the sale of Sodi-bi-crab and demanded additional tax. The Assistant Commissioner upheld the assessment, stating that Sodi-bi-crab did not qualify as a grocery item based on the Commissioner's list of grocery articles. The Assistant Commissioner rejected the contention that Sodi-bi-crab should be considered a grocery item due to its availability in grocery shops, citing examples of non-grocery items sold in such shops. The Assistant Commissioner concluded that the purchasing dealer could not claim tax exemption for Sodi-bi-crab based on its registration as a grocery goods dealer.

The advocate for the assessee argued that Sodi-bi-crab, commonly known as eating soda and available in grocery shops, should be considered a grocery item for tax purposes. The assessee and the purchasing dealer both dealt in grocery goods, and Sodi-bi-crab was used in food preparation and as a cure for indigestion. Despite the lack of a specific definition of "grocery" in the relevant Act, the Commissioner's classification of grocery goods did not include Sodi-bi-crab. However, the advocate relied on a case precedent to argue that the term "grocery" should be interpreted in its popular sense as commonly understood in trade and commerce. The advocate contended that Sodi-bi-crab, being commonly available in grocery shops and used in food preparation, should be considered a grocery item eligible for tax exemption.

The Tribunal found that Sodi-bi-crab, also known as eating soda, was generally available in grocery shops and commonly used in food preparation. The Tribunal noted that the assessee and the purchasing dealer primarily dealt in grocery goods, and Sodi-bi-crab was a commonly used item in food and snacks. Despite being a chemical compound, Sodi-bi-crab's common availability in grocery shops and its usage as a food item supported its classification as a grocery good. The Tribunal concluded that the purchasing dealer was entitled to purchase Sodi-bi-crab free of tax based on its registration as a grocery goods dealer. Therefore, the Tribunal allowed the appeal, reducing the assessment to the returned figures and ordering a refund of any excess tax collected.

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