9911796707
TMI Blog1977 (3) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... 6, at Nagpur and Bombay. In respect of the period from 1st April, 1960, to 31st March, 1961, the Sales Tax Officer assessing the applicants allowed the sales of the rags and chindhis made by the applicants as not taxable taking the view that the same were covered by entry 15 of Schedule A to the said Act. The applicants filed an appeal against the assessment order passed by the Sales Tax Officer in connection with some other items. Thereafter, the Deputy Commissioner of Sales Tax issued a notice under section 57 of the said Act and, after hearing the applicants, on 14th August, 1967, passed an order disallowing the exemption granted by the Sales Tax Officer in respect of the sales of rags and chindhis and assessed the sales of these goods a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, but do not include any such fabric- (a) if it contains 40 per cent or more by weight of wool; (b) if it contains 60 per cent or more by weight of rayon or artificial silk; or (c) if manufactured on a handloom." On 5th January, 1957, the Central Government issued Notification No. S.R.O. 21 in exercise of the powers conferred by sub-rule (1) of rule 8 of the Central Excise Rules, 1944, inter alia, exempting from the whole of the duty leviable thereon under the Central Excises and Salt Act, 1944, what has been referred to as "the cotton fabrics described below". Item No. 10 of these exempted items read thus: "Damaged or sub-standard cotton fabrics which are classified as: (a) 'Chindhis'-that is to say, cut pieces of cotton fab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itution, item No. 12 of the First Schedule became item No. 19 of the said schedule; and it is common ground that in view of the provisions of section 8 of the General Clauses Act, reference to the said item No. 12 of the First Schedule to the Central Excises and Salt Act in entry 15 of Schedule A to the said Act will have to be read from 1st October, 1960, as reference to item No. 19 of the First Schedule to the Central Excises and Salt Act, 1944. This, however, does not make any difference because item No. 19 is in the same terms as the aforesaid item No. 12. It is the contention of Mr. Shah, the learned Advocate for the applicants, that the rags and chindhis sold by the applicants were admittedly pieces of cotton cloth, that is, cloth m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chased for a purpose other than being used for clothing or covering of furniture or any similar use, these pieces of cloth cannot be regarded as cloth or cotton fabric at all. We find it difficult to accept the aforementioned contentions of Mr. Phadkar. The term "cotton fabrics" has been defined in item No. 12 and later in item No. 19 of the First Schedule to the Central Excises and Salt Act, 1944, and this definition includes within its ambit all varieties of fabrics manufactured out of the material described in the said item. The definition clarifies that dhoties, sarees, chadars, bed-sheets, bed-spreads, counter-panes and table-cloths are included in the ambit of the term "cotton fabrics". Now, the relevant dictionary meaning of the wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or bales manufactured by the mills, it does not cease to be manufactured cloth or cotton fabric. It is true that the rags and chindhis sold by the applicants must have been pieces of cloth of irregular shapes and sizes. We fail to see, however, how for this reason they would cease to be manufactured cloth. We also fail to see how these rags and chindhis cannot be regarded as manufactured cloth, merely because the purchasers from the applicants were putting them to use as raw material for making paper or paper products. If the argument of Mr. Phadkar, in this connection, were to be accepted, it would result in the description of a commodity being governed by the use to which it may be intended to be put by a purchaser, and this obviously can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would be covered by the said item No. 10. This circumstance, however, in our view, is of no relevance at all, because even if the rags and chindhis were not of the said sizes all that it would mean is that they would not be exempt under the said notification from the levy of excise duty. This would, in no way, show that the same ceased to be cotton fabrics. We may, in this connection, refer to a decision of the Madras High Court in Kishinchand Chellaram v. Joint Commercial Tax Officer[1968] 21 S.T.C. 367., where it has been held that, ordinarily, courts, when called upon to interpret the meaning of the words used in the schedules to the Sales Tax Acts, mainly rely upon their popular or ordinary meaning. The meaning which the trade, Governme ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
