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TMI Blog1968 (5) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... or arriving at the "taxable turnover" in respect of the assessment of the general sales tax for the years 1953-54, 1954-55 and 1955-56, it was entitled to deduct therefrom the amount of the said sales of timber in exercise of the assessee's right conferred on it by the following provision contained in section 5(2)(a)(iv) of the Act"5. (2) In this Act the expression 'taxable turnover' means that part of a dealer's gross turnover during any period which remains after deducting therefrom- (a) his turnover during that period on- * * * * * (iv) sales to any undertaking supplying electrical energy to the public under a licence or sanction granted or deemed to have been granted under the Indian Electricity Act, 1910, of goods for use by it in the generation or distribution of such energy * * * * * It is the common case of both sides that if the supply of timber for the construction of the power-house or power-houses in dispute fell within sub-clause (iv) of clause (a) of sub-section (2) of section 5 of the Act, the assessee would be entitled to get the deduction in question. The decision of the assessing authority against the assessee in this respect was upheld in appeal by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not the case in the sales that have come up before me." The assessee then filed an application before the Financial Commissioner under sub-section (1) of section 22 requiring the Financial Commissioner to refer the abovesaid question of law to this Court. By his order, dated 18th April, 1960, the Financial Commissioner found that there was really no further special question of law that arose out of his abovesaid order, dated 15th January, 1960, and, therefore, he saw no justification for sending up these cases to this Court. The applications of the assessee under section 22(1) of the Act were, therefore, dismissed. It was in the above circumstances that three separate applications under sub-section (2)(b) of section 22 (General Sales Tax Cases Nos. 8 to 10 of 1960) were filed by the assessee in this Court, as a result of which the Division Bench directed the Financial Commissioner to state the case and to refer the above-quoted question for the opinion of this Court, in pursuance of which direction the present reference has been made, which has now come up for disposal before us. In order to answer the question of law referred to us, all that we have to decide is whether ti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g can be said to be made available "for use by it in the generation or distribution of such energy" or it is only supply of such goods as are required in the process of generation of the energy or in its actual distribution depends, in my opinion, on the meaning and scope of the word "in" which precedes the expression "the generation or distribution" of electrical energy. According to the learned counsel for the assessee, the word "in" is of substantially wide amplitude and in the context in which it is used in the relevant provision, it is synonymous with the expression "in connection with". In the Oxford English Dictionary, Volume V, page 125, it is stated that in the general sense"The proposition (in) expressing the relation of inclusion, situation, position, existence, or action, within limits of space, time, condition, circumstances, etc. In ancient times, expressing also (like L. In) motion or direction from a point outside to one within limits; the two senses being determined by the case of the word expressing the limits, the former taking the dative (originally locative), the latter the accusative or case of direction. These cases being subsequently levelled, this distincti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it would not fall within the exemption in question. As soon as the question arises as to where the line has then to be drawn and attention is paid to the relevant concluding words of the provision, it is obvious that deduction can be claimed for sale of only those goods supplied to an electric undertaking which are required by it not only for use by the undertaking but only for such use which partakes of or shares in the generation or distribution of electrical energy. In other words, the sale of only such goods will fall in the statutory exemption, the use of which either results in the generation or in the increase of generation of electrical energy, or which goods are used either for arranging or facilitating distribution of the energy. Timber supplied for making shutters of a power-house does not appear to satisfy any of those requirements. In Webster's "New International Dictionary", Volume II, Second Edition, page 1253, "in" is stated to indicate, inter alia, "relation to a whole which includes the part spoken of" and also indicates "inclusion with respect to scope or influence, or occupation with respect to some physical or mental activity or state". In the aforesaid sense ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and effect must be given to every word of the relevant enactment in construing it and, as already stated, the construction sought to be placed on the relevant provision by Mr. Sodhi would, in my opinion, amount to obliterating from the statute and ignoring the words "in the generation or distribution of such energy". No other argument having been advanced in support of the proposition canvassed in these proceedings on behalf of the assessee, I would answer the question referred to us in the negative, that is, against the assessee and hold that on the facts and circumstances of this case the sale of timber for the construction of the power-house or houses in question could not be said to have been effected for use "in the generation or distribution of electrical energy" within the meaning of section 5(2)(a)(iv) of the Act. In the circumstances of the case, there is no order as to costs of this reference. SHAMSHER BAHADUR, J.-It seems to me that if the intention was to exempt from general sales tax every article which went in making the machinery and construction of the power-house a different language would have been used. An obvious limitation has now been placed by saying tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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