1964 (9) TMI 42 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of the term 'drinks' in item No. 49 of Part II of Schedule II under the Madhya Pradesh General Sales Tax Act, 1958.

Analysis:
The judgment pertains to a reference under section 44 of the Madhya Pradesh General Sales Tax Act, 1958, initiated by the Commissioner of Sales Tax to determine whether the term 'drinks' in item No. 49 of Part II of Schedule II includes aerated waters. The assessee, a manufacturer of aerated waters, contended that the tax on sales of aerated waters should be levied at 4% under Part VI of Schedule II, rather than 7% under entry No. 49 of Part II. The Sales Tax Officer and the first appellate authority rejected this contention, but the Tribunal ruled in favor of the assessee, stating that aerated waters were not covered under the term 'drinks' in the said entry.

Entry No. 49 of Part II of Schedule II lists various items including eatables and drinks packed in tins or bottles. The Court analyzed the entry and applied the rule of ejusdem generis to interpret the term 'drinks'. The rule of ejusdem generis dictates that general words following specific examples are limited to things of the same nature as those examples. The Court cited a precedent from the Madras High Court to support this principle, emphasizing that the term 'etc.' in an enumeration restricts the scope of the general words.

The Court concluded that aerated waters, being distinct from items like syrups, distilled juices, jams, and fruit juices listed in item No. 49, do not fall under the category of 'drinks' as intended in the entry. Therefore, the tax liability on aerated waters should be determined under item No. 1 of Part VI of Schedule II at the rate of 4%. The judgment answered the reference by affirming that the term 'drinks' in item No. 49 of Part II, Schedule II, does not encompass aerated waters, thereby resolving the issue raised by the Commissioner of Sales Tax.