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TMI Blog1982 (11) TMI 153X X X X Extracts X X X X X X X X Extracts X X X X ..... STC 485, a Division Bench of the Mysore High Court held as follows: "In my opinion, it is not correct to say that if a person buys butter and sells the ghee produced from it, what is sold by him is what he purchased. The words 'ghee' and 'butter' as ordinarily understood by those who use them are different substances and in commercial usage they are regarded as different classes of goods. The purposes for which the one is used are not the same as the purposes for which the other is employed. If, therefore, what the assessee purchased was butter and what he sold was ghee, what he sold was not the same as what he purchased, notwithstanding the fact that what he sold was what he produced by merely melting what he purchased." In that case, the interpretation of section 10 of the Bombay Sales Tax Act was involved. The goods were described as "milk products including butter, ghee, chhena and khoa (except sweetmeats and excepting butter-milk and curds declared as tax-free under entry 4 of Schedule A)" and thereafter the rate of tax was prescribed. The assessee purchased butter from unregistered dealers and since the butter was a milk product, the assessee was liable to pay purchase ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter and cream were made liable to sales tax at one point at 1 per cent. Another modification was made in the list of exemption by Notification No. ST-II-6625/X-1012-1972 dated 1st December, 1973, and now entry 10 reads as follows: "Milk and milk products but excluding (1) products sold in sealed containers, (2) sweetmeats, (3) ghee and (4) butter, cream and cheese." Thus, cheese also became liable to sales tax. Thereafter came the notification which we have to consider now. The notifications referred to above indicate that over the course of time first ghee, then butter and cream and then cheese were made liable to tax. Under the impugned notification, the turnover of first purchase of goods mentioned in the list was made liable to tax under clause (b) of sub-section (1) of section 3-D of the Act at the rate mentioned against each. In the description of the goods, we find ghee including butter, cheese and cream other than butter, cheese or cream sold in sealed or tinned containers and the rate of tax prescribed is 3 per cent. The first purchase of butter, therefore, clearly attracts tax at 3 per cent. The contention of the assessee which has been accepted, is that when the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... minerals, ores, metals, and alloys including sheets and circles used in the manufacture of brasswares and scraps containing only any of the metals, copper, tin, zinc, or nickel except those included in any other notification issued under the Act." The Supreme Court held that: "But here the expression 'including' does not enlarge the meaning of the word 'metal' and must be understood in a conjunctive sense, as a substitute for 'and'. This is the reasonable and proper construction having regard to the scheme followed in the framing of those notifications." The scheme followed in reference to the taxability of milk products to the extent relevant has been mentioned earlier. Thus, the decision of the Supreme Court is an authority for the proposition that while interpreting a particular notification, the scheme of taxation followed earlier may be taken into consideration. If we read the word "including" in the notification as "and", no difficulty in interpreting the notification will arise. The description of the goods would, thus, run as follows: "Ghee and butter, cheese and cream other than butter, cheese or cream sold in sealed or tinned containers." I may briefly refer to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The question for consideration before the court was whether the assessee was liable to special sales tax on the sale of blank registers, exercise books, letter-pads, labels, loose printed forms, envelopes, cards and flat files, which it had prepared from the papers purchased by it from the dealer; in other words, whether these articles were different within the meaning of the notification attracting the incidence of taxation at the point of sale by the manufacturer, namely, the assessee. The High Court held that in view of the fact that the paper included all types of paper mentioned therein, the assessee was not liable to pay sales tax. Here the word "include" has been really read as "means and includes" and I am in respectful agreement with the view of the Patna High Court as far as the interpretation of the notification is concerned but I do not find it possible to accept the argument of the learned counsel for the assessee that the entry in the notification under consideration should be read in the like manner. The case on which very strong reliance is placed by the learned counsel for the assessee is a Division Bench case of this Court in the case of Commissioner of Sales ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... how that it was not merely employed for the purpose of adding to the natural significance of the words or expressions defined. It may be equivalent to 'mean and include' and in that case, it may afford an exhaustive explanation of the meaning which, for the purposes of the Act, must invariably be attached to these words or expressions.' Considering the background in which the word 'include' was used in the notification and the fact that perfumed hair-oil is, properly speaking, a cosmetic or toilet requisite, Notification No. ST-8492 of 1969 did nothing more than to give an exhaustive meaning to the words 'cosmetics and toilet requisites'. Perfumed hair-oil was specifically included in cosmetics and toilet requisites by Notification No. ST-8490. Once it was included, its exclusion or otherwise became immaterial." As has been mentioned earlier, ghee and butter are different commercial commodities. The purchase of butter by the assessee would attract purchase tax and he would pay first purchase tax and sales of ghee made by him would attract sales tax under section 3-D(2) as what he would sell was ghee. As has been noticed earlier, ghee, butter, cheese and cream had been taxed sep ..... X X X X Extracts X X X X X X X X Extracts X X X X
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