TaxTMI 
TaxTMI 
1991 (8) TMI 311
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....-clause (d) of clause (29A) of article 366, be subject to such restrictions and conditions in regard to the system of levy, rates and other incidents of the tax as Parliament may by law specify. In view of the aforesaid constitutional mandate provisions were made in the Central Sales Tax Act, 1956 (for short, "the CST Act"). Section 2(c) of the CST Act defines "declared goods" and the said term means goods declared under section 14 to be of special importance in inter-State trade or commerce. Section 14 of the CST Act declares certain goods to be of special importance in inter-State trade or commerce, and for the convenience these goods have come to be known as "declared goods". A conjoint reading of sections 14 and 15 of the CST Act will show that so far as declaration of goods under section 14 is concerned, the sales tax law of the State shall impose or authorise imposition of tax not exceeding 4 per cent of the sale or purchase price thereof and such tax shall not be levied at more than one stage. So far as clause (i) of section 14 of the CST Act is concerned, it reads as under: "Section 14: Certain goods to be of special importance in inter-State trade or commerce.-It is her....
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....72, was superseded by notification dated September 8, 1976 and the petitioner as well as members of the Rajasthan Flour Mills Association (one of the petitioners) were taxed under the aforesaid notifications dated September 8, 1976, March 26, 1988 and March 23, 1989 on the plea that with effect from September 8, 1976, wheat as such is a declared commodity under section 14 of the CST Act and therefore, the restrictions prescribed under section 15 of the said Act do not apply to the other forms of wheat, i.e., flour and fine-flour (maida and suji) and the Rajasthan Sales Tax Tribunal confirmed the levy under the notification dated September 8, 1976. The litigation is going on and the matter is said to be pending in this Court in various revision petitions under the RST Act. 6.. The petitioners' case further is that in the year 1989 the case of Dhanbad Flour Mills v. State of Bihar [1989] 75 STC 47 (Pat) came to the notice of the petitioner wherein a view had been taken that atta, maida and suji, which are obtained by merely reducing the size of wheat grains into smaller particles or powder, are included in the item "wheat" in section 14(i)(iii) of the CST Act and are to be treated....
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.... under article 226 of this Court and more so in a case where the jurisdiction to impose and levy tax has been challenged on the ground that flour and fine-flour are forms of wheat and therefore they are declared goods which have already suffered tax at the rate of 4 per cent as provided under section 15. We will therefore proceed to examine the issue and we will see as to whether in the term "wheat" in clause (i)(iii) of section 14 of the CST Act, flour or fine-flour are also included or "wheat" has been used therein in the restricted sense? 9.. It was contended by the learned counsel for the petitioners that flour and fine-flour, i.e., maida and suji are merely forms of wheat and therefore are declared goods under the above referred clause (i)(iii) of section 14 of the CST Act. Learned counsel has built his case on the case of Dhanbad Flour Mills' case [1989] 75 STC 47 wherein the Patna High Court has taken a view that atta, maida and suji are included in the item "wheat" in section 14(i)(iii) of the CST Act. In the aforesaid case reliance was also placed upon the case of Alladi Venkateswarlu v. Government of Andhra Pradesh [1978] 41 STC 394 (SC). In the aforesaid case of Allad....
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....hether the goods can be termed both in sub-section (1) of section 5 as well as sub-section (2) of section 5 simultaneously. The court said: "We do not think that it is fair to so interpret a taxing statute as to impute an intention to the Legislature to go on taxing what is virtually the same product in different forms over and over again. Such a result would be contrary to basic axioms of taxation. Unless the language of the taxing statute was absolutely clear, it should not be given an obviously unfair interpretation against the assessee." (underlining* is ours) The court quoted Kayani and Co. v. Commissioner of Sales Tax [1953] 4 STC 387 (Hyd.) and said that: "The only principle deducible from it is that the commonly accepted sense of a term should prevail in construing the description of an article of food. While dealing with an item meant for rice as a cereal, the court had accepted a more limited meaning of the term 'rice' so as to exclude cooked rice in all its forms. Of course, the case before us is not a case of rice cooked and prepared in the form of 'pulao' or 'biriyani' or any other type of cooked rice which may have undergone changes of character by add....
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....rt in its recent cases of New Swastik Flour Mill v. State of Karnataka (Writ Petitions Nos. 3600 and 3601 of 1990 decided by the Karnataka High Court on March 7, 199l)*. We will make reference to the aforesaid cases at a later stage of this order. 10.. We have already extracted in the earlier part of this order clause (i)(iii) of section 14 of the CST Act. We are of the opinion, it will be proper to read the entire section 14 of the CST Act even if it may lead to repetition in so far as clause (i)(iii) is concerned. Section 14 of the CST Act reads as under: "Section 14: Certain goods to be of special importance in inter-State trade or commerce.-It is hereby declared that the following goods are of special importance in inter-State trade or commerce- (i) cereals, that is to say,- (i) paddy (Oryza sativa L.) (ii) rice (Oryza sativa L.); (iii) wheat (Triticum vulgare, T. compactum, T. sphaerococcum, T. durum, T. aestivum L., T. dicoccum); *Reported in [1992] 84 STC 49 (Kar) (iv) jowar or milo (Sorghum vulgare Pers); (v) bajra (Pennisetum typhoideum L.); (vi) maize (Zea mays D.); (vii) ragi (Eleusine coracana gaertn.); (viii) kodon (Paspalum scro....
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.... channels, tees, sheet piling sections, Z sections or any other rolled sections); (vi) sheets, hoops, strips and skelp, both black and galvanised, hot and cold rolled, plain and corrugated, in all qualities, in straight lengths and in coil form, as rolled and in rivetted condition (vii) plates both plain and chequered in all qualities; (viii)discs, rings, forgings and steel castings; (ix) tool, alloy and special steels of any of the above categories; (x) steel melting scrap in all forms including steel skull, turnings and borings; (xi) steel tubes, both welded and seamless, of all diameters and lengths, including tube fittings; (xii) tin-plates, both hot dipped and electrolytic and tinfree plates; (xiii)fish plate bars, bearing plate bars, crossing sleeper bars, fish plates, bearing plates, crossing sleepers and pressed steel sleepers, rails-heavy and light crane rails; (xiv)wheels, tyres, axles and wheel sets; (xv) wire rods and wires-rolled, drawn, galvanised, aluminised, tinned or coated such as by copper; (xvi)detectives, rejects, cuttings or end pieces of any of the above categories; (v) jute, that is to say, the fibre extracted from plants ....
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....Central Excises and Salt Act, 1944 (1 of 1944)." Mr. Bapna, learned counsel for the Revenue, has contended that before the CST Act came into force an Act to declare under article 286(3) of the Constitution of India, certain goods to be essential for the life of the community was framed by the Parliament which was known as The Essential Goods (Declaration and Regulation of Tax on Sale or Purchase) Act, 1952 (for short "the Act of 1952") and Schedule was enacted under section 2 in which certain goods were declared as essential for the life of the community. Item 1 in the aforesaid Schedule, was as under: "Cereals and pulses in all forms including bread and flour including atta, maida, suji and bran (except when any such article is sold in sealed containers)." It was contended by Mr. Bapna, learned counsel, that rule of interpretation is that where two statutes dealing with the same subject-matter use different language it is an acknowledged rule of construction that one may be looked at as a guide to the construction of the other. If one uses distinct language imposing a penalty under certain circumstances and other does not, it is always an argument that the Legislature did....
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....h it can be, do not apply to flour and fine-flour, i.e., maida and suji. 11.. Mr. Bhojwani, learned counsel for the petitioners, placing reliance on the aforesaid cases of the Patna and Karnataka High Courts contends that fineflour, maida or suji, or atta are made out of wheat and they continue to possess the old identity and it is not a different identity and therefore, the fact that the Legislature in clause (i)(iii) of section 14 of the CST Act has only used the word "wheat" it has included in all its forms and it will not be confined to wheat alone. According to the learned counsel one has to apply the common sense rule and if one goes by the rule of common sense there is no dispute that all forms of wheat are wheat within the meaning of section 14(i)(iii) of the CST Act and will be subject to restrictions and conditions in respect of tax on sale or purchase as prescribed in section 15 of the CST Act. Mr. Bhojwani has relied on the aforesaid two cases, namely, Dhanbad Flour Mills' case [1989] 75 STC 47 (Pat) and New Swastik Flour Mill's case [1992] 84 STC 49 (Kar). In the case of Dhanbad Flour Mills [1989] 75 STC 47 (Pat), reliance was placed on the case of Alladi Venkate....
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.... Court was considering the case of arhar dal in various forms. The petitioner in that case had purchased "dal" from dal mills and the contention of the petitioner in that case was that the dal purchased by him must be treated as a second purchase, the first purchase having been effected by the dal mills. The question for consideration arose whether the broken dal continued to be arhar dal. The learned Judges said at page 120, para 3: "There is no essential physical change except that the dust is shaken off, the husk or covering is removed and the dal itself is broken down into smaller pieces." The court further said that: "Having regard to the processes leading to the preparation of the broken down dal purchased by the petitioner, we are unable to hold that it represents a new and different article from the original grain. There is nothing to show that it is commercially regarded as essentially of a distinctive character from the original grain either by virtue of its name, character or use." In the third of the aforesaid cases, namely, the case of Shri Kishan Satyanarain v. State of Madhya Pradesh [1983] 54 STC 25 the Madhya Pradesh High Court was dealing with clause (....
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....to whether the provisions of sections 14 and 15 of the CST Act were attracted or not. That apart, there was no physical transformation of rice to a distinct cereal commodity and parched rice and puffed rice continued to be rice as such. The Karnataka High Court considered a number of cases and concluded that atta, maida and suji are not goods different from wheat. In taxing matters one has ultimately to take a common sense view of the matter. The terms as understood in the commercial sense and with reference to their use must be kept in view in order that a correct conclusion may be reached. The court should keep in mind whether one going to market to buy a commodity will purchase some different commodity offered to him. In this case, if a man goes to purchase wheat and if fine-flour, maida or suji is offered to him, will he purchase the same? Though, there can be no dispute that the flour and fine-flour (maida and suji) continued to be cereals and that they are obtained by crushing wheat into flour or fine-flour but in physical appearance maida and suji are different commodities than wheat. In the case of Ram Chandra Badrinarayan v. State of Orissa [1974] 33 STC 83, a Division Ben....
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....under section 14(i) of the CST Act to be of special importance in inter-State trade or commerce and whether in any specified goods as aforesaid as given thereunder restricted or exhaustive meaning was to be given. The court appears to have been primarily governed by the fact that there was no change which occurred in the essential nature of the commodity. In the case of State of Gujarat v. Sakarwala Brothers [1967] 19 STC 24 (SC), the court was considering the case of "patasa", "harda" and "alchidana" and whether they fall within the definition of "sugar" in entry 47 of Schedule A to the Bombay Sales Tax Act, 1959. The said item of the said Act defined "sugar" which means any form of sugar containing more than 90 per cent of sucrose. The court said that the Legislature used the words "any form" in a sense distinct and different from any variety. The words "any form of sugar" are intended to cover sugar in any form, by whatever name called. The qualifying words are that it must contain more than 90 per cent sucrose. It will therefore appear that the case was decided on the intention of the Legislature by using the words "any form of sugar" and the court said that the use of the afor....
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....numerate separately taxable goods, viz., "iron and steel". Each sub-item in entry (iv) is a separate taxable commodity for purpose of sales tax and each of them forms a separate species for each series of sales although they may all belong to the genus "iron and steel". The court referring to the definition of that phrase in Stroud's Judicial Dictionary, 4th Edition, Volume 5, at page 2753, said"The quotation, given above, from Stroud's Judicial Dictionary shows that, ordinarily, the expression 'that is to say' is employed to make clear and fix the meaning of what is to be explained or defined. Such words are not used, as a rule, to amplify a meaning while removing a possible doubt for which purpose the word 'includes' is generally employed. In unusual cases, depending upon the context of the words 'that is to say' this expression may be followed by illustrative instances. In Megh Raj v. Allah Rakhia AIR 1947 PC 72, the words 'that is to say' with reference to a general category 'land' were held to introduce, 'the most general concept' when followed, inter alia, by the words 'right in or over land'. We think that the precise meaning of the words 'that is to say' must vary with the ....
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.... by the Parliament in exercise of its powers conferred on it under the then clause 286(3) of the Constitution. Under the then article 286(3) the Parliament could declare any goods to be essential for the life of community, and under clause (3) of article 286 of the Constitution which was brought in the statute book by the Constitution (Forty-sixth Amendment) Act, 1982, the Parliament can declare by law and levy tax on the sales or purchase of goods declared to be of special importance in inter-State trade or commerce, but under the Act of 1952 under Schedule in clause 1 the entry was "cereals and pulses in all forms including bread and flour, including atta, maida, suji and bran (except when any such article is sold in sealed containers)". The said Act was repealed by section 16 of the CST Act as it stood before it was repealed by Repealing and Amending Act, 1960 (58 of 1960), and the CST Act was framed by the Parliament and in exercise of article 286(3) of the Constitution it declared the goods provided in section 14 of the CST Act to be of special importance. It will appear from a comparative study of the Schedule and more so its entry 1 of the Act of 1952 as well as clause (i) o....