1973 (7) TMI 66 - HC - VAT and Sales Tax

Summary

Issues:
1. Classification of hair clippers under sales tax notifications.
2. Determination of the applicable tax rate for sales of hair clippers.

Classification of Hair Clippers:
The case involved determining whether hair clippers should be classified as unclassified items, mill-stores and hardware, or machinery under specific sales tax notifications. The revising authority initially concluded that hair clippers were a type of scissors and did not fall under the categories of machinery or hardware as per the relevant notifications. However, the court referred to a Full Bench decision which clarified that items falling under the category of mill-stores and hardware must have common characteristics, which hair clippers did not share. Therefore, the court held that hair clippers could not be categorized as hardware.

Applicable Tax Rate for Hair Clippers:
Regarding the determination of the tax rate applicable to sales of hair clippers, the court referred to a Full Bench case which interpreted a notification exempting machinery and spare parts from tax. The court analyzed the definition of machinery as per the notification, emphasizing that machinery includes instruments transmitting force or energy. The court concluded that hair clippers, being instruments transmitting force, fell under the notification unless subject to tax under another notification. The court disagreed with the revising authority's view that hair clippers were not commonly understood as machinery, stating that mechanical contrivances are generally recognized as machinery. Consequently, the court answered the first question in the negative and the second question in the affirmative, holding that the sales of hair clippers were taxable under the notification. The parties were directed to bear their own costs.

Conclusion:
The court's judgment clarified the classification of hair clippers for sales tax purposes and determined the applicable tax rate for their sales based on specific notifications. By referencing relevant legal precedents and definitions, the court provided a detailed analysis to resolve the issues raised by the revising authority.