1970 (8) TMI 64 - SC - VAT and Sales Tax

Whether Sarin Tooth Powder manufactured by M/s. Sarin Chemical Laboratory is cosmetic or a toilet requisite as held by the High Court of Allahabad or it is an unspecified commodity liable to sales tax at all points of sale as held by the Additional Judge (Revisions) Sales Tax, Agra? Held that - Appeal dismissed. The question whether tooth-powder can be considered as a toilet came up before the Madras High Court in V.P. Somasundara Mudaliar v. State of Madras 1963 (7) TMI 67 - MADRAS HIGH COURT and before the Bombay High Court in Commissioner of Sales Tax v. Vicco Laboratories 1968 (2) TMI 99 - BOMBAY HIGH COURT . Both the courts took the view that the tooth-powder is a toilet. The same view has been taken by the Allahabad High Court

Summary

Issues:
1. Determination of whether "Sarin Tooth Powder" is classified as a "cosmetic" or a "toilet requisite" for sales tax purposes under the U.P. Sales Tax Act.
2. Interpretation of the terms "cosmetic" and "toilet requisite" in the absence of specific definitions in the Act.
3. Comparison of dictionary meanings with common parlance understanding to decide the classification of tooth powder.
4. Analysis of previous court decisions regarding the classification of tooth powder as a toilet requisite.

Detailed Analysis:
The Supreme Court judgment involved connected appeals concerning the classification of "Sarin Tooth Powder" manufactured by M/s. Sarin Chemical Laboratory under the U.P. Sales Tax Act. The primary question was whether the tooth powder should be considered a "cosmetic" or a "toilet requisite" for sales tax purposes. The appellant contended that the turnover from tooth powder sales should be taxed at a specific rate, while the Commissioner of Sales Tax argued for taxation at a single point under a different provision. The High Court sided with the Commissioner, leading to the appellant challenging this decision in the Supreme Court.

The Act did not provide definitions for "cosmetic" or "toilet requisite," prompting the court to refer to dictionary meanings for guidance. The court highlighted that a cosmetic is a preparation for beautifying or altering appearance, while toilet refers to grooming or cleansing items. The court emphasized that common parlance understanding should prevail in the absence of statutory definitions, as established in previous judgments. Notably, the court referenced a case involving the classification of betel leaves to illustrate the importance of interpreting terms in their popular sense.

Further, the judgment cited decisions from the Madras and Bombay High Courts, along with the Allahabad High Court, which considered tooth powder as a toilet requisite. The court aligned with these views, concluding that tooth powder is commonly understood as a toilet requisite based on both dictionary meanings and previous judicial interpretations. Consequently, the appeals challenging the High Court decision failed, leading to their dismissal with costs.

In conclusion, the Supreme Court's judgment clarified the classification of tooth powder as a toilet requisite for sales tax purposes, emphasizing the importance of interpreting terms based on common understanding in the absence of statutory definitions. The decision relied on dictionary meanings and previous court rulings to affirm that tooth powder falls within the category of a toilet requisite, ultimately upholding the High Court's decision and dismissing the appeals.