1980 (2) TMI 238

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....of Motor Spirits Taxation Act, 1957?" 2.. The material facts, as set out in the statement of case, are as follows: The assessee-company is engaged in the business of sale and distribution of petrol and petroleum products. The assessee was assessed to sales tax for the period from 26th December, 1963, to 25th December, 1964, by order dated 28th, March, 1968, by the Assistant Sales Tax Commissioner. By this order, the turnover arising out of the sale of Esso solvents Nos. 1425, 2445 and 3040 was taxed under entry No. 39 of Part II of Schedule II to the Act, which provided for taxation of all kinds of petroleum products and mineral oils including kerosene oil except those that are liable to tax under the M.P. Sales of Motor Spirits Taxation....

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....indirectly to provide reasonable efficient fuel for automotive or stationary internal combustion engines and includes petrol, diesel oil and other internal combustion oils but does not include kerosene, furnace oil, coal or charcoal." The definition of "petrol" is to be found in section 2(i) of the Motor Spirits Act and it is as under: "'Petrol' means dangerous petroleum as defined in the Petroleum Act, 1934 (30 of 1934); and includes admixture of power alcohol as defined in the Indian Alcohol Act, 1948 (Central Act 22 of 1948), and petrol." The provisions of section 2(a) and (b) of the Petroleum Act. 1934, which were in force at the material time, are as under: "2. In this Act, unless there is anything repugnant in the subject ....

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....r spirit" because it cannot provide reasonable efficient fuel for automotive or stationary internal combustion engines. It is thus clear that the clause "which by itself or in admixture with other substances is ordinarily used directly or indirectly to provide reasonable efficient fuel for automotive or stationary internal combustion engines", occurring in section 2(h) of the Motor Spirits Act, has been construed by the Board to govern not only the words "any substance" preceding the said clause but also the words "petrol ", "diesel oil" and "other internal combustion oils", which follow that clause. This construction placed by the Board is, in our opinion, erroneous. Esso solvent No. 1425 is, it is not disputed, "petroleum" having its flas....