TaxTMI 
TaxTMI 
1952 (7) TMI 13
X X X X Extracts X X X X
X X X X Extracts X X X X
....edule III of the Assam Sales Tax Act and the length of the cloth actually sold was another relevant factor of the test. In their view exemption could be claimed under item No. 16 of Schedule III of the Act only if pieces of cloth sold did not exceed six yards in length and the price of each piece did not exceed Rs. 10. The assessee disputed the correctness of the interpretation placed on this item and applied for a reference. The question referred by the Commissioner of Taxes is as follows: "Whether the criterion in the qualification-when the price per piece of six yards does not exceed Rs. 10-in Column 2 against item 16 of Schedule III is the price per yard (calculated on the basis of Rs. 10 for six yards) irrespective of the actual length sold at any one time?" The question is not happily worded. What is meant to be conveyed is whether for purposes of claiming exemption from tax under item No. 16 of Schedule III, the price per yard calculated on the basis (not more than Rs. 10 per six yards) is the only criterion regardless of the length sold at any one time. In the reference the learned Commissioner expressed the view that in item No. 16 there was emphasis not on price alone b....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... and pulses. Goods or commodities exempted had to be described. As regards item No. 2 relating to agricultural imple- ments the condition of exemption was that the price per piece should not exceed Rs. 15. Now the sale of all agricultural implements satisfying the value or the price test would be exempt from sales tax. The number of implements sold at any given time is wholly immaterial. One thousand different implements may be sold. But if the price per piece does not exceed Rs. 15 the entire transaction is exempt from taxation under the Act. It will be clear that so far as this item is concerned the price test is the only criterion for determining whether the transaction is taxable or not. The quantity sold at a given time is immaterial. Item No. 6 deals with cheap cloth. The exemption in the case of sale of this cloth can be claimed where the cloth is of that variety and price as may be notified by the Provincial Government. Even here it is the variety of the cloth and the price which would afford the criterion for determining whether exemp- tion can be claimed or not. The quantity sold at a given time is not relevant for determining whether exemption can be claimed or not. Simi....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... time. There will be no point in insisting that a man if he wants an exemption under the Sales Tax Act, must have three pieces of six yards each and not 18 yards in one length. Once he is allowed to purchase as much as he needs or he likes, all that has to be seen is whether he has purchased handwoven cloth made from mill-made yarn and that its price per piece of six yards does not exceed Rs. 10. The expression "per piece" shows that a piece of six yards was intended to be utilised merely as a unit for calculating the price. Again if the intention was that whatever quantity is purchased, it must be in six yards pieces, the provision would be extremely difficult to enforce and this aspect of the matter would have attracted notice. When cloth exceeding six yards in length is sold, it can easily be described as sold in pieces of six yards length, to the extent that the length purchased is a multiple of six. But quite apart from this difficulty even this inter- pretation would create an anomalous situation. A dealer sells three pieces of six yards each and a fourth piece of 2 yards. No tax will be payable on the sale of the three pieces. But the balance of two yards would not be a six....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... per piece of six yards does not exceed Rs. 10 and the cloth is of the variety covered by item No. 16 of Schedule III, the transaction is exempt from taxation irrespective of the actual length sold at any one time. The criterion laid down is the price per yard calculated on the basis of Rs. 10 for six yards and the conditions laid down in the item have no reference to the actual lengths sold or to the units in which (1) [1940] A.L.J. 860; 9 I.T.R. 9. (3) (1950) I.L.R. 1950 Nag. 403. (2) [1952] 3 S.T.C. 102. they are sold. The question is answered in the affirmative. We make no order as to costs. DEKA, J.-In spite of my best efforts, I could not wholly agree with the view expressed by my learned brother as to the interpretation of Item No. 16 in Schedule III to the Assam Sales Tax Act, 1947. I, how- ever, agree as to the conclusion solely on the ground that the description of cloth entered in the right-hand column of item No. 16 in Schedule III presents some degree of ambiguity in its interpretation. The interpreta- tion given by the assessee cannot altogether be ruled out because of the inadequacy of expression defining the exact class or measure of cloth which is exempted from as....