TaxTMI 
TaxTMI 
2018 (4) TMI 1218
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....stic product. 3. Aggrieved by the said levy of the Additional Sales Tax, assessee has filed A.P.No.79 of 2000, before the Appellate Assistant Commissioner (CT)-I, Chennai, who allowed the appeal for the entire disputed turnover of Rs. 2,15,895/-, on the ground that the goods sold by the respondent-assessee are synthetic woven fabric and hence, they are eligible for exemption. Relevant portion of the appellate authority's order is extracted hereunder: "I have heard the arguments of both the sides with connected records. The Assessing Officer has assessed the turnover of Rs. 2,15,995/-, at 8% being the sale of synthetic cotton fabric under entry 33-A of Part-C of First Schedule. The Advocate who has appeared at the time of final hearing has argued that the sale synthetic cotton fabric is exempted from tax which falls under entry 8(II) of Third Schedule of the Act. The Advocate has produced purchase and sale bills and he has also argued that the Assessing Officer has exempted the same sales of synthetic cotton fabric for the previous years. He has also produced the assessment order of the previous years. A perusal of the documents produced by the Advocate shows that the appella....
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....larification do not relate to goods in question viz. synthetic woven fabric. The learned Counsel for the respondent/assessee has further added that the Assessing Officer himself allowed exemption on sale of goods in question in the previous year and subsequent year assessment order. Therefore, the appeal order passed by the Appellate Assistant Commissioner allowing exemption on the sale of synthetic woven fabric falling under Item 8(ii) of Part A of Third Schedule is based on facts of this case on hand and hence correct. The respondent-assessee while filing the written submissions, he also enclosed copy of purchase bill, sale bill, previous and subsequent year's assessment orders wherein the synthetic woven fabric was allowed and exempted by the Assessing Officer. Finally, the learned Counsel for the respondent-assessee has respectfully prayed to sustain the orders of the first Appellate Authority and thus render justice. 8. We have considered the rival submissions and perused the connected records. The appellant merely based on the Commissioner's Clarification seek to treat the synthetic Woven fabrics sold by the respondent-dealer as plastic product. In the clarificatio....
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....esiduary item, liable to tax at 8% under the Tamil Nadu General Sales Tax Act, 1959. Heard the learned counsel appearing for the parties and perused all the materials available on record. 7. Tax exempted goods, listed in Schedule III of Tamil Nadu General Sales Tax Act, 1959, include tobacco, sugar, cotton and woolen fabrics, handloom cloth and few other commodities. Besides, conditional exemption, effected through special notifications, is also accorded to the sale/purchase of a number of goods by certain persons or institutions. 8. In Delhi Cloth & General Mills Co. Ltd., v. State of Rajasthan reported in (1980) 46 STC 256 : AIR 1980 SC 1552, the Hon'ble Supreme Court, at Paragraph 9 of the judgment, explained what fabric is, "What is a fabric? The "Mercury" Dictionary of Textile Terms defines "fabric" as a term which covers "all textiles no matter how constructed, how manufactured, or the nature of the material from which made," and the expression "textile" is described as "any product manufactured from fibres through twisting, interlacing, bonding, looping, or any other means, in such a manner that the flexibility, strength, and other characteristic properties of the i....
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...., dated 14.05.2014] reported in 2014 SCC Online P&H 9597, the Punjab and Haryana High Court, while considering the question, as to whether in the facts and circumstances of the present case, HDPE/PP Woven Fabric is Artificial silk and therefore falls within the ambit of Entry 51 of Schedule B of Haryana VAT Act, 2003, held as follows: "Learned counsel for the appellant has vehemently argued that the fabric manufactured by the appellant from HDPE is artificial silk and thus falls within exempted good from payment of tax in terms of Section 2(1) (p) of the Act. The reliance is placed upon a Division Bench judgment of Madras High Court reported as (1982) 51 STC 364 titled as The State of Tamil Nadu Vs. Polyweb Private Ltd. . The Madras High Court was considering Item 4 of the Third Schedule to Tamil Nadu General Sales Tax Act, 1959 and the question whether High-Density Polyethylene woven fabrics is artificial silk . The entry under consideration in the aforesaid Act reads as Cotton fabrics, woolen fabrics and rayon or artificial silk fabrics, as defined in items 19, 21 and 22 respectively of the First Schedule to the Central Excises and Salt Act, 1944 (Central Act 1 of 1944) . Item ....
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.... not natural silk, the same substance when it becomes a fibre and is used for being made into fabrics, somehow ceases to be artificial silk. We have no doubt that this article must be regarded as artificial silk as defined in item 22 of the First Schedule to the Central Excises and Salt Act." Learned counsel for the appellant relies upon an order passed by the Allahabad High Court reported as [1984] 57 STC 188 titled as Commission of Sales Tax Vs. Kanpur Plastic Pack (P.) Ltd. wherein it has been held that HDPE fabric falls within notification dated 25.11.1958 and is artificial silk. Reliance is placed upon order of the Hon ble Supreme Court reported as (1981) 2 SCC 528, titled as Indo International Industries Vs. Commissioner of Sales Tax, U.P. that while interpreting items in statutes like the Excise Acts or Sales Tax Act, resort should not be to the scientific and technical meaning of the terms or expressions used but to their popular meaning, that is to say, the meaning attached to them by those dealing in them. On the other hand, Mr. Poonia relies upon a Division Bench judgment of this Court reported as (2008) 31 PHT 74 (P&H) titled as Lakshmi Polyfab Vs. Union Territory o....
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.... Haryana General Sales Tax Act, 1973 came up for examination before the Hon ble Supreme Court in a judgment reported as (1979) 1 SCC 82 Porritts & Spencer (Asia) Ltd. v. State of Haryana . The Court observed that in a taxing statute words of everyday use must be construed not in their scientific or technical sense but as understood in common parlance. It observed as under:- "3. Now, the word 'textiles' is not defined in the Act, but it is well settled as a result of several decisions of this Court, of which we may mention only a few, namely, Ramavatar Budhaiprasad vs. Assistant Sales Tax Officer, Akola, AIR 1961 SC 1325 and M/s. Motipur Jamindary Co. (P) Ltd. v. State of Bihar, AIR 1962 SC 660 and The State of West Bengal v Washi Ahmed, (1977) 2 SCC 246 that in a taxing statute words of every day use must be construed not in their scientific or technical sense but as understood in common parlance. The question which arose in Ramavatar's case (supra) was whether betel leaves are vegetables and this Court held that they are not included within that term. This Court quoted with approval the following passage from the judgment of the High Court of Madhya Pradesh in Madhya....
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.... of the terms used, and not in their scientific or technical sense, for the Legislature does "not suppose our merchants to be naturalists, or geologists, or botanists.". 5. There can, therefore, be no doubt that the word 'textiles' in Item 30 of Schedule 'B' must be interpreted according to its popular sense, meaning "that sense which people conversant with the subject-matter with which the statute is dealing would attribute to it" . In terms of the judgment of the Hon ble Supreme Court in Indo International Industries case (supra) and Porritts & Spenscer's case (supra), the meaning attached to the entries should be those dealing in them and not the scientific or technical meaning. The word artificial silk is not defined in the statute. Silk is a thread which is commonly made from fibre produced by silk worms. Therefore, the meaning of such expression is what the common meaning of such expressions is in the normal usage. As per Chambers Dictionary the word artificial means made by man; synthetic; fictitious, made in imitation, whereas the word silk also includes artificial silk to be made by forcing a viscous solution of modified cellulose through small hol....
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....ving adopted may be the warp and woof pattern as is generally the case in most of the textiles, or it may be any other process or technique. There is such phenomenal advance in science and technology, so wondrous i.. the variety of fabrics manufactured from materials hithereto unknown or unthought of and so many are the new techniques invented for making fabric out of yarn that it would be most unwise to confine the weaving process to the warp and woof pattern. Whatever be the mode of weaving employed, woven fabric would be 'textiles'. What is necessary is no more than weaving of yarn and weaving would mean binding or putting together by some process so as to form a fabric. Moreover a textile need not be of any particular size or strength or weight. It may be in small pieces or in big rolls: it may be weak or strong, light or heavy, bleach or dyed, according to the requirement of the purchaser. The use to which it may be put is also immaterial and does not bear on its character as a textile. It may-be used for making wearing apparel, or it may be used as a covering or bedsheet or it may be used as tapestry or upholstery or as duster for cleaning or as towel for drying the b....
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....er to include within the scope of the expression artificial silk and silk like substance which is not natural silk, but which is produced by human agency out of any product or a combination of products by any process. All that is necessary is that artificial silk , like natural silk, must be a fibre. Accordingly, high density polyethylene must be regarded as falling within the generic term artificial silk and fabrics made out of high density polyethylene, either wholly or in part, whether they are hundred per cent pure or not, qualify for exemption from sales tax as goods falling within the description artificial silk fabrics set out in item 4 of the Third Schedule to the Tamil Nadu General Sales Tax Act, 1959. In the understanding of an expression, courts will not be doing violence to the principles of statutory construction if they pay regard to how such an expression is understood not only by the trade or by high technology in general, but also by the concerned departments of Government, part of whose task it is to put a correct interpretation on the expression in question for the purpose of running their departments. It was submitted by the Learned Counsel for the appellant rel....