TaxTMI 
TaxTMI 
2006 (2) TMI 603
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....e First Schedule deals with goods exempted from the tax, the Second Schedule deals with the goods which are taxable at one per cent and the Third Schedule deals with goods which are taxable at four per cent and finally the Fourth Schedule deals with goods which are taxable at 20 per cent. All the unscheduled goods are taxed at the Revenue Neutral rate of 12.5 per cent under section 4(1)(b) of the KVAT Act. In fact, in the Third Schedule prior to its substitution entry No. 4 dealt with aluminium utensils and enamelled utensils. However, in the substituted Third Schedule which came into effect from June 7, 2005 entry No. 5 is substituted in place of earlier entry No. 4, which refers to "all utensils including pressure cookers and pans other than utensils made up of precious metals". Thus, the description of the goods at entry No. 5 is far wider when compared to the earlier entry before substitution. The appellant believed that all the goods manufactured by it including pressure cookers, stoves, tavas and flasks would fall within the definition of utensils and would be chargeable at four per cent as per the aforesaid entry to the Third Schedule. However, with a view to seek an a....
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....gislature has included entry No. 5 in the Third Schedule. Therefore, he submits that the said finding requires to be interfered with. Per contra, Smt. Sujatha, learned Additional Government Advocate contended that utensils necessarily mean a vessel, that too, used in a kitchen. A stove is not a utensil because it is not a vessel. In fact, even before this Act came into force stoves were taxed under a separate head. In that view of the matter, the finding recorded by the authority is in consonance with the understanding of the word utensil in common parlance and it does not call for any interference. In the light of the aforesaid contentions, the short point that arises for our consideration is, whether the word "utensils" includes a stove and flask? In Shorter Oxford Dictionary the meaning of the word "utensil" has been given as under: "Any article useful or necessary in a house hold; a domestic implement, vessel, or article of furniture; an instrument or vessel in common use in a kitchen, dairy, etc.; any vessel or other article serving a useful end or purpose; a tool or implement used by artisans, farmers, etc." The meaning of the word "utility....
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.... require to be understood the way in which they have been defined in the statute and in the absence of such definitions in the statutes, they should be understood in their popular meaning and as understood in commercial or common parlance. The intention of the legislation which is paramount not only requires to be taken note of, but also the purpose for which the Legislature intends to levy tax at the reduced rate of tax. In this back ground we have to find out whether the word "utensils" includes stove and flask. In the Schedule under the earlier entries the rate of tax was prescribed for steel articles, aluminium articles and other articles made of other metals as well as pressure cookers. In fact, in the Third Schedule prior to its substitution by the Karnataka Value Added Tax (Amendment) Ordinance (1 of 005) which came into effect on June 7, 2005 at entry 4 goods taxable at four per cent were "aluminium" and "enamelled" utensils. However, in he substituted Third Schedule which came into effect from June 7, 2005 in entry No. 5 is included "all utensils including pressure cookers and pans other than utensils made up of precious metals". Thus, the legislative intent is made cle....
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....erely, because a stove or flask is used outside the house also and in hotels and restaurants and in commercial enterprises, it cannot be said that it does not fall within the word "utensil". Having regard to the use of a stove or a flask in kitchen by a common man, the use of those items commercially outside the house is negligible. That cannot be the determining factor. The Supreme Court in the case of Annapurna Biscuit Manufacturing Co. v. Commissioner of Sales Tax, U.P., Lucknow [1981] 48 STC 254, has held that the words used in a law imposing a tax should be construed in the same way in which they are understood in ordinary parlance in the area in which the law is in force. If an expression is capable of a wider meaning as well as a narrower meaning the question whether the wider or the narrower meaning should be given depends on the context and the background of the case. In fact, a division Bench of this court in the case of Raja Brick & Tile Industries v. Additional Commissioner of Commercial Taxes, Zone-II, Bangalore [2006] 146 STC 124; [2005] ILR Karn 34, has held that the terms and concepts appearing in the taxing statutes require to be understood the way in which t....