TaxTMI 
TaxTMI 
2017 (5) TMI 1540
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....atery coconut holding it to be the oil seed rejecting the claim of the petitioners that it is exempted from tax, as the same is included in Entry 54 of Schedule I of the Chhattisgarh Commercial Tax Act, which provides for goods exempted from tax. The petitioners are carrying on the business of dealing in dry coconut as well as in watery coconut. They claim exemption from sale of watery coconut as tax free as falling in Schedule I of Entry 54 of the Chhattisgarh Commercial Tax Act, 1994. The petitioners filed quarterly returns and claimed the sale of watery coconut as exempted from the above Entry while paying tax at 4% on dry coconut. In the course of assessment proceedings, the petitioners were called upon to show cause why the watery coconut be not taxed as oil seed as specified in clause (vi) of Section 14 of the Central Sales Tax Act, 1956 taxable at 4% as included in the Commercial Tax Act under Entry 4 of Schedule-II of Part-IV. The petitioners claim was rejected and 4% was charged on watery coconut and penalty was also imposed on which it was taken to revision under Section 62 of the Chhattisgarh Commercial Tax Act which was dismissed by the Divisional Deputy Commissioner ag....
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....sions used but their popular meaning has to be considered. Further relying upon the decision of the Supreme Court in the matter of Commissioner of Sales Tax, Madhya Pradesh v. Popular Trading Co. (2000) 33 VKN 314, he would also submit that watery coconut is after-all a coconut and therefore it has rightly been charged as an oil seed. By concluding his submission, he would submit that coconut can never be treated and has never been treated the member of fruit family and therefore it has rightly been charged as an oil seed and 4% tax has been levied which is strictly in accordance with law. 7. I have heard learned counsel for the parties and considered their rival submissions made herein-above and also perused the available record critically and carefully. 8. In order to consider the plea raised at the Bar, it would be appropriate to notice the relevant judgments regarding construction of taxing statutes. 9. A taxing statute is to be construed strictly. The well-established rule in the familiar words of Lord Wensleydale, reaffirmed by Lord Halsbury and Lord Simonds, means: "The subject is not to be taxed without clear words for that purpose; and also that every Act of Parliament ....
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....onsideration may stem from administrative experience and other factors of life and not artistic visualisation or neat logic and so the literal, though pedestrian interpretation must prevail." 15. Thus, a focused glance on the principle followed by Their Lordships of the Supreme Court in interpreting the taxing statute, it is quite vivid that before taxing any person it must be shown that he falls within the ambit of the charging section by clear words used in the section. If the words used are ambiguous and reasonably open to two interpretations benefit of interpretation is given to the subject. But equitable considerations are not relevant in construing a taxing statute, and similarly logic or reason cannot be of much avail in interpreting a taxing statute. (See Azamjha v. Expenditure Tax Officer, Hyderabad (1971) 3 SCC 621) 16. In the matter of Kapil Mohan v. Commr. of Income-tax, Delhi (1999) 1 SCC 430 it has been held that in the field of taxation, hardship or equity has no role to play in determining eligibility to tax and it is for the legislature to determine the same. 17. Similar principle has been applied to the Sales Tax statute. 18. In Indo International Industries (....
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....51] CLR (Ex) 122, (which decision was approved by this Court in Commissioner of Sales Tax v. Jaswant Singh Charan Singh, [1967] 19 STC 469 (SC) ; [1967] 2 SCR 720). Would a householder when asked to bring home "fresh fruit" and some "vegetable" for the evening meal bring coconut? Obviously, the answer is in the negative." 20. A Constitution Bench of the Supreme Court in Sri Siddhi Vinayaka Coconut & Co. (supra), has held that "watery coconuts" and "dried coconuts" are two distinct commodities commercially speaking and observed as under: - "We also accept the contention put forward on behalf of the State of Andhra Pradesh that "watery coconuts" and "dried coconuts" are two distinct commodities commercially speaking. Watery coconuts are put to a variety of uses, e.g., for cooking purposes, for religious and social functions, whereas dried coconuts are used mainly for extracting oil. This court has in a number of cases held that the same commodity at different stages could be treated and taxed as commercially different articles. In A. Hajee Abdul Shukoor & Co. v. State of Madras [1964] 15 S.T.C. 719 (S.C.) : [1964] 8 S.C.R. 217, this court held that "hides and skins in the untanne....
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....ax Act, which is similar to the provisions with which we are concerned in the present case, and the other as stated in the Third and Fourth Schedules to the Andhra Pradesh General Sales Tax Act. In that context, this Court had to consider whether a "watery coconut" could be taxed within the permissible restrictions as also "dried coconut" that resulted from the drying of the same watery coconut. It was contended that under the State statute though "watery coconut" and "dried coconut" were treated separate there is a provision for refund when "watery coconut" had suffered tax became "dried coconut". In that context that decision was rendered and we are concerned with different kind of entry for tax. 5. This Court in Ganpat Lal Lakhotia v. State of Rajasthan (supra) quoted with approval what was stated in Sri Krishna Coconut Co. v. Commercial Tax Officer, (1965) 16 STC 511 (AP), wherein it was stated as follows: "In a tender coconut, the kernel is hardly formed or is only in the initial stages of formation. In a dried coconut the kernel has formed and fully developed and further the water inside the coconut has dried up leading to the drying of the kernel also. But a fully grow....