1995 (3) TMI 450 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of tax entry under Karnataka Tax on Entry of Goods Act, 1979 regarding taxation on plastic bangles and glass bangles.

Analysis:
The main issue in this case revolves around the interpretation of the circular issued by the Commissioner regarding the taxation of plastic bangles and glass bangles under the Karnataka Tax on Entry of Goods Act, 1979. The question raised was whether these items attract tax at the rate of 2 per cent as per specific entries in the government notification dated April 30, 1992. The petitioners argued that the expression "glass sheets and all articles made of glass" or "plastic sheets and articles made from all kinds and forms of plastic" do not include bangles made of glass or plastic based on various legal precedents cited.

The Government Pleader representing the department contended that the relevant entries cover all articles made of glass or plastic, including bangles made of these materials. However, the court analyzed the language used in the entries and highlighted that the Legislature specifically mentioned "glass sheets" and "plastic sheets" along with "articles made of glass" or "articles made from all kinds and forms of plastic." The court applied the principle of noscitur a sociis, which means that the meaning of a word is judged by the company it keeps. This principle was supported by legal references, including a Supreme Court judgment, to interpret the words in a statute.

The court concluded that the Legislature did not intend to include plastic bangles and glass bangles in the tax entry for glass and plastic articles. The assessments made by the Commissioner regarding the levy of tax on these items were deemed inappropriate and were quashed. However, the assessments in other respects were to remain undisturbed. Ultimately, the court allowed the petitions and made the rule absolute, thereby granting relief to the petitioners in this matter.