2005 (7) TMI 619 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Whether the manufacture of toughened glass amounts to the manufacturing of "glass and glasswares including optical glass in all its forms" as mentioned in the notification under section 4-B of the U.P. Sales Tax Act, 1948.

Issue-wise Detailed Analysis:

Issue 1: Interpretation of "Glass and Glasswares Including Optical Glass in All its Forms"
The primary issue is whether the manufacture of toughened glass qualifies as the manufacturing of "glass and glasswares including optical glass in all its forms" under the relevant notification. The dealer-opposite party sought total exemption from sales tax on the purchase of raw materials and packing materials used in manufacturing automobile toughened safety glass parts.

Relevant Notifications and Legal Provisions
The dealer-opposite party applied for a recognition certificate under section 4-B of the U.P. Sales Tax Act, 1948. The assessing authority granted a certificate allowing the purchase of raw materials at a concessional rate of tax but not a total exemption. The appellate authorities amended this to grant total exemption, leading to the present revision.

The notifications in question include:
- Notification No. 7551 dated December 31, 1976, which mentions "glass and glasswares including optical glass in all forms."
- Notification No. ST-II-4519 dated August 29, 1987, which superseded previous notifications and included "glass and glasswares including optical glass in all its forms but excluding ornamented and cut glass bangles."

Judicial Precedents
The court referred to several judgments to interpret the term "glasswares":
- Indo International Industries v. Commissioner of Sales Tax: The Supreme Court held that "glassware" in commercial parlance does not include specialized items like clinical syringes, thermometers, and lactometers.
- Atul Glass Industries (P.) Ltd. v. Collector of Central Excise: The Supreme Court ruled that glass mirrors cannot be classified as "other glass and glassware" and that automobile screens are considered motor vehicle parts, not glass or glasswares.
- Hindustan Safety Glass Works v. Commissioner of Sales Tax: The High Court held that toughened glass sheets are not included in "glass and glasswares" under a different notification.

Analysis and Conclusion
The court emphasized the principle that items in tax statutes should be interpreted based on their common and popular meaning, not their scientific or technical definitions. The Supreme Court's decision in Atul Glass Industries was pivotal, where it was held that automobile screens, including wind screens, rear screens, and door screens, are motor vehicle parts and not glass or glasswares.

The Tribunal's description of the manufacturing process of automobile toughened glass indicated that it involves significant transformation from plain glass sheets, making the final product commercially distinct from raw glass sheets.

The court concluded that automobile toughened safety glass parts, including wind screens, door screens, side screens, and back screens, do not fall under the category of "glass and glasswares." These items are finished products and are more appropriately classified as motor vehicle parts.

Final Judgment
The court set aside the Tribunal's order and the first appellate authority's order, ruling that automobile toughened safety glass parts do not qualify as "glasswares" within the meaning of the notification under section 4-B of the Act. The revision was allowed with no order as to costs.