1978 (3) TMI 205 - HC - VAT and Sales Tax

Summary

Issues:
Classification of trestles as furniture for tax purposes.

Analysis:
The judgment of the Court pertained to the classification of trestles for tax assessment purposes. The initial assessing authority had taxed the turnover of the dealer at the rate applicable to furniture sales, but the appellate authority considered trestles as unclassified items and reduced the tax rate. The Commissioner of Sales Tax filed a revision challenging this decision, which was dismissed by the additional revising authority. The key question referred to the Court was whether trestles fell under the classification of furniture and were liable to tax as such.

The additional revising authority, in confirming the appellate decision, emphasized that the term "furniture" was not defined in the Sales Tax Act or relevant notifications. They referred to dictionary definitions of furniture, highlighting that it includes articles used for convenience or decoration in a house or apartment. The authority concluded that for an article to be considered furniture, it must be essential for daily living needs and align with the general notion of furniture usage.

Furthermore, the additional revising authority determined that trestles, primarily used in armouries for stacking or storing guns, did not meet the criteria of being essential for daily living convenience or decoration in a dwelling place. They compared trestles to cycle stands in public places, indicating that they were not typical furniture items. However, the Court disagreed with this assessment, noting that trestles, being movable articles used for resting guns in various settings, including homes, qualified as furniture.

The Court cited a precedent from the Gujarat High Court, where shelving racks made from iron and steel were considered furniture under the Bombay Sales Tax Act. Drawing from this precedent, the Court concluded that trestles manufactured by the assessee should be classified as articles of furniture. Therefore, the question was answered in the affirmative, favoring the department over the assessee. The Commissioner of Sales Tax was awarded costs, and the reference was resolved in favor of the department.