1971 (2) TMI 85 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of Notification No. ST-911/X dated 31st March, 1956 regarding exemption for agricultural implements like sprayers.
Classification of sprayers as agricultural implements or machinery under the sales tax law.

Analysis:
The judgment was delivered in response to a question of law raised by the Commissioner of Sales Tax, U.P., regarding the classification of "sprayers" under the U.P. Sales Tax Act. The dispute revolved around whether sprayers should be considered agricultural implements under Notification No. ST-911/X dated 31st March, 1956, or machinery under a different notification. The assessee, engaged in the business of brass syringes and agricultural sprayers, claimed tax exemption for sprayers based on the mentioned notification. The Sales Tax Officer initially rejected the claim, leading to an appeal where the appellate authority deemed sprayers as agricultural implements but not covered by the specific articles listed in the notification for exemption. However, the Judge (Revisions) allowed the assessee's claim, asserting that sprayers, being agricultural implements, were covered by the notification despite not being explicitly listed.

Regarding Notification No. ST-911/X dated 31st March, 1956, it exempts certain articles, including agricultural implements worked by human or animal power. The key contention was whether sprayers, although acknowledged as agricultural implements, were excluded from exemption due to not being explicitly listed in the notification. The sales tax department argued that sprayers fell under the category of "machinery and spare parts of machinery" as per another notification dated 5th April, 1961. The crux of the matter was whether the list of agricultural implements in the 1956 notification was exhaustive, determining the taxability of sprayers.

The court analyzed the language of the notification, particularly the use of the word "namely" preceding the list of agricultural implements. The word "namely" was interpreted to indicate examples rather than an exhaustive list, implying that all agricultural implements worked by human or animal power should be exempted. The court emphasized that the intention was to differentiate between human/animal-powered implements and mechanized ones, intending to exempt all former category items. Additionally, the court noted that the question of whether sprayers could be classified as machinery was not raised in the revisional order, and since agricultural implements were specifically addressed in the 1956 notification, their taxability should be determined based on that specific provision, following the principle that specific provisions override general ones.

In conclusion, the court ruled that sprayers were correctly treated as agricultural implements falling within the scope of the 1956 notification, entitling the assessee to exemption. The judgment clarified the interpretation of the notification and upheld the assessee's claim, awarding costs and counsel's fees accordingly.