1995 (1) TMI 347 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of entry 73(a) of Schedule C under the Bombay Sales Tax Act, 1959 regarding the classification of a washing plant as a domestic or commercial electrical appliance.

Analysis:
The case involved a reference under section 61(1) of the Bombay Sales Tax Act, 1959, where the question was whether a washing plant sold by the assessee fell under entry 73(a) of Part II of Schedule C or under the residuary entry 102. The assessee contended that the washing plant was not covered by entry 73(a) as it was used for cleaning machines, vehicles, and factory floors, not for washing clothes as specified in the entry. The Commissioner and the Tribunal held that the washing plant fell under entry 73(a), leading to this reference.

The interpretation of entry 73(a) was crucial in determining the classification of the washing plant. Entry 73(a) covered domestic and commercial electrical appliances like grinders, mixers, irons, and washing machines. The court noted that the term "appliances" referred to items of day-to-day use for domestic or commercial purposes. The entry did not encompass machinery like the washing plant in question, which had a different purpose and usage, not fitting the definition of a domestic or commercial electrical appliance.

The court referred to dictionary meanings to clarify the term "appliance," emphasizing that it typically denoted electrical gadgets used in homes or offices. The illustrations in entry 73(a) further supported the limited scope of electrical appliances intended to be covered. The court analyzed the technical specifications and usage of the washing plant, concluding that it was machinery rather than a washing machine, falling under the residuary entry 102 for taxation purposes.

A subsequent entry, 44A, specifically addressed machinery operated by electricity, excluding items specified in other entries. The court highlighted that post the insertion of entry 44A, the washing plant would fall under that entry, further supporting its classification as machinery rather than a domestic or commercial electrical appliance under entry 73(a).

Ultimately, the court held that the washing plant in question did not qualify as a domestic or commercial electrical appliance under entry 73(a) of Schedule C. Therefore, it fell under entry 102 of Schedule C for taxation purposes. The court answered the reference question in the negative, favoring the assessee, and made no order as to costs, concluding the judgment.