1989 (9) TMI 359 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of the term "fodder" under entry 34 of Schedule B of the Haryana General Sales Tax Act, 1973.

Detailed Analysis:

The case involved a dispute regarding the classification of binola chhilka under the Haryana General Sales Tax Act, 1973. The dealer claimed that binola chhilka should be considered as fodder under entry 34 of Schedule B and therefore exempt from tax. The Assessing Authority disagreed and treated it as cotton seeds, leading to additional tax liability. The Deputy Excise and Taxation Commissioner upheld this view, stating that only fodder produced in farms after grain extraction was exempt. However, he remanded the case to reassess the tax liability. The Sales Tax Tribunal later accepted the dealer's appeal, ruling that binola chhilka qualifies as fodder due to its essential characteristic as animal food, overturning the assessment order.

The High Court examined the definition of "fodder" as per entry 34 of Schedule B, noting that the term was not explicitly defined in the Act or Rules. Referring to the Chambers Twentieth Century Dictionary, which defines fodder as "food supplied to cattle," the Court concluded that binola chhilka, being a staple part of animal food and containing roughage, falls within the common understanding of fodder. Importantly, the exclusion in entry 34 did not mention chhilka of cotton seeds, which is distinct from foodgrains and pulses. Therefore, the Court held that binola chhilka qualifies as fodder and should be exempt from tax, ruling in favor of the dealer and against the Revenue.

In conclusion, the High Court answered the referred question in the affirmative, stating that binola chhilka should be considered as fodder under entry 34 of Schedule B of the Act. The Court's decision favored the dealer, emphasizing that the nature of binola chhilka as animal food with roughage content aligns with the common understanding of fodder. The judgment clarified the classification of binola chhilka for tax purposes, providing clarity on its treatment under the Haryana General Sales Tax Act, 1973.