TaxTMI 
TaxTMI 
2022 (12) TMI 965
X X X X Extracts X X X X
X X X X Extracts X X X X
....Question of law framed by this Court: 2. While entertaining the revision petition, this Court vide Order dated 3rd May, 2018 framed the question of law that whether SAREE, PATTA, DHOTI and GAMUCHHA fall under Entry Serial No.3 of Part-II of Schedule appended to the OET Act? Facts of the case: 3. Tax Audit being undertaken, on the basis of Audit Visit Report submitted under Section 9B of the OET Act, Assessment was framed under Section 9C vide Order dated 05.11.2012 raising a demand to the tune of Rs.7,54,898/- (tax of Rs.2,51,632.82 + penalty of Rs.5,03,265.64) by the Sales Tax Officer, Bhubaneswar-II Circle, Bhubaneswar (be called, "Assessing Authority") rejecting the claim of the petitioner-dealer that Odisha entry tax is not exigible on the goods, such as "saree, patta, dhoti and gamuchha", bought from persons, not registered under the statute, within the State of Odisha and, as such, brought into the "local area" for consumption, use or sale therein, as such goods do not find place at Entry 3, Part-II of Schedule to the OET Act. 3.1. The relevant fact as reflected in the Assessment Order is quoted hereunder for better understanding: "*** When confronted the facts of obser....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the classification of commodity vis-à-vis leviability of entry tax on the goods namely "saree, patta, dhoti, gamuchha". 5.1. The learned Additional Standing Counsel has pressed into service the following observations of the learned OSTT: "9. This Tribunal is, therefore, of the considered view that a conjoint reading of the relevant entries in Part-I and Part-II of the Schedule would imply that by using the word 'textile products' along with the cotton fabrics and ready-made garments, the Legislature never intended to restrict the meaning thereof, rather the intention was to impose a particular tax for a specific group of textile products like pure silk fabric etc. under Part-I and another rate of tax for all textile products in general. The use of the words 'including cotton fabrics and readymade garments' after the words 'textile products' must be held to be for the purpose of clarification only and to distinguish it from specific items mentioned in Part I least there is any confusion on such score. 10. It is further observed that the goods in question have been mechanically treated as handloom goods even though such a specific stand was never taken by the dealer and ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... upon to be applied does not deserve indulgence by this Court in the instant revision. Discussion and reasons: 6. The relevant entries fall for consideration in the present revision petition are as follows: Part-I 5. Pure silk fabric, silk, artificial silk yarn and raw silk Part-II 3. Textile products including cotton fabrics and ready-made garments 7. Scrutiny of both the competing entries would suggest that whereas Entry 5 of Part-I relates to items of "silk" which are subject to entry tax @1% in terms of Rule 3(3) of the Odisha Entry Tax Rules, 1999, Entry 3 of Part-II indicates levy of tax @2% as per Rule 3(2) ibid. on "textile products including cotton fabrics and ready-made garments". It can be culled out from what has been laid down in Annapurna Biscuit Manufacturing Co. Vrs. Commissioner of Sales Tax, (1981) 48 STC 254 (SC) 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 and if an expression is capable of a wider meaning as well as narrower meaning the question whether the wider or narrower meaning should be given depends on the context and t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 'means and includes' such definition is to be given a wider meaning and is not exhaustive or restricted to the items contained or included in such definition. 7.4. In Black Diamond Beverages Pvt. Ltd. Vrs. CTO, (1997) 107 STC 219 (SC) = AIR 1997 SC 3550 = (1998) 1 SCC 458, it has been observed as follows: "It is clear that the definition of 'sale price' in Section 2(d) uses the words 'means' and 'includes'. The first part of the definition defines the meaning of the word 'sale price' and must, in our view, be given its ordinary, popular or natural meaning. The interpretation thereof is in no way controlled or affected by the second part which 'includes' certain other things in the definition. This is a well-settled principle of construction. Craies on Statute Law (7th Edn. 1.214) says: 'An interpretation clause which extends the meaning of a word does not take away its ordinary meaning .... Lord Selborne said in Robinson Vs. Barton Eccles Local Board (1883)8 App.Case 798 (801): 'An interpretation clause of this kind is not meant to prevent the word receiving its ordinary, popular, and natural sense whenever that would be properly applicable, but to enable the word as used i....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 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 the said case [Porritts & Spencer (Asia) Ltd. Vrs. State of Haryana, (1978) 42 STC 433 (SC)], the Hon'ble Court has described the meaning of 'textiles' in the following manner: "The word 'textiles' is derived from the Latin 'texere', which means 'to weave' and it means any woven fabric. When yarn, whether cotton, silk, woollen, rayon, nylon or of any other description or made out of any other material is woven into a fabric, what comes into being is a 'textile' and it is known as such. It may be cotton textile, silk textile, woollen textile, rayon textile, nylon textile or any other kind of textile. The method of weaving 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 is the variety of fabrics manufactured from materials hitherto unknown or unthought of and so many are the new techniques invented for making fabric out of yarn that it w....
X X X X Extracts X X X X
X X X X Extracts X X X X
....neric term embracing all textile fabrics and laminar felts and 'textile' is applied in its modern sense to: any manufacture from fibres, filaments, or yarns, natural or artificial, obtained by interlacing. The 1967 Annual Book of ASTM Standards defines cloth as: any textile fabric but specially one designed for apparel, domestic or industrial use and textile fabric as a planar structure consisting of interlaced yarns or fibres. The 1973 Annual Book of ASTM Standards reproduced those definitions." 8.3. In Shree Meenakshi Mills Ltd. Vrs. Union of India, (1974) 1 SCC 468 the term "textile" has been described thus: "18. The dictionary meanings of cotton textile are any material that is woven, a material, as a fibre or yarn, used in or suitable for weaving, woven or capable of being woven. The meaning of "textile" as a noun is a fabric which is or may be woven, a fabric made by weaving, a woven fabric, or a material suitable for weaving, textile material. The dictionary meanings show that cotton yarn is included in cotton textile." 8.4. In State of Haryana Vrs. Crown Agencies P. Ltd., (2010) 34 VST 84 (P&H), while considering whether "labels" are regarded as "textile", the v....
X X X X Extracts X X X X
X X X X Extracts X X X X
....gh Court in Delhi Cloth General Mills Co. Ltd. Vrs. Commercial Tax Officer, Central Section, West Bengal, with which ruling we are in respectful agreement.' 21. When the facts of the present case are examined in the light of the principles laid down in the aforesaid judicial pronouncements, we are left with no doubt that 'labels' have to be regarded as textiles. It has remained undisputed on facts that names of the companies for which the labels are prepared is woven, which is the process used for weaving any other textile. It does not involve any printing by any external aid. Therefore, in the facts and circumstances of the case 'labels' have to be regarded as textile and covered by Entry 14 of Schedule 'B' of the Act." 8.5. In Vrajlal Bhukhandas Vrs. State of Gujarat, (1964) 15 STC 437 (Guj) after referring to meaning of "cloth" from different Dictionaries, the Hon'ble Court referring to Kosuri Subba Raju, (1956) 7 STC 479, stated thus: "... In that decision, the Andhra High Court laid down that the words 'cotton cloth' were used in the aforesaid provisions to denote every fabric used for any purpose including the use as a wearing apparel and that cloth did not cease to be c....