1966 (12) TMI 63

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.... manufactures, inter alia, oxygen gas and also welding apparatus and stores and sells them. The assessee prepares the oxygen by the industrial process known as fractional distillation of liquid air. In other words air is first liquified and then the other gases are allowed to escape and pure oxygen is obtained. The oxygen so produced Is sold by the assessee for purposes of welding metals and also for the use of medicinal purposes in the treatment of pneumonia, bronchitis etc. There is no material on the record as to what quantity was sold for medicinal or welding purposes. The total turnover of gases which include acetylene gas was Rs. 3,92,384-67 nP. It was claimed that gases manufactured were not chemicals and therefore did not fall to be....

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.... however, is as to what is a chemical? Now when the word "chemical" is used in a taxing statute with which commercial men have to deal with, it may not always be right to give the technical or dictionary meaning thereof. The meaning of such words requires to be such as is commonly understood by commercial men who use such articles. If strictly technical meaning is given to the word "chemicals " then perhaps many substances such as coal, sugar, salt, saltpetre etc. would satisfy the meaning and be assessable at single point and not under the general classification. Unfortunately, in the present case there is no evidence as to what meaning commercial men attribute to the word "chemicals". Therefore, there is no alternative but to go to the di....

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....ed charcoal has been used as an explosive."-vide, Inorganic Chemistry by Partington. Therefore, whether the assessee produces oxygen by the industrial process or fractional distillation of liquid air, the fact remains that oxygen can be produced by chemical process and it can undergo chemical action and produce chemical changes in other substances. It is therefore difficult, if not impossible, to escape from the conclusion that it is a chemical. A chemical, however, can also be a medicine and, therefore, merely arriving at the conclusion that oxygen is a chemical will not answer the question as framed. The second limb of the question is whether oxygen manufactured by the assessee is a chemical or a medicine. The learned Judge (Revisions)....