9911796707
TMI Blog1996 (1) TMI 388X X X X Extracts X X X X X X X X Extracts X X X X ..... o quashed the penalties imposed by the assessing authorities by holding that entry 16-B, the constitutional validity of which was under challenge, though not pressed at the hearing, underwent alterations on three occasions. The decision of the learned single Judge is under challenge in this group of appeals at the behest of the Assistant Commissioner of Commercial Taxes and the State of Karnataka. As the issue involved in all the appeals is common, the appeals are disposed of by this judgment. 2.. The Government of Karnataka enacted the Karnataka Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1979 ("the Act"), to provide for the levy of tax on entry of goods into local areas for consumption, use or sale. Section 3 of the Act is the charging section and, inter alia, provides that there shall be levied and collected a tax on entry of the scheduled goods into a local area for consumption, use or sale therein at such rate not exceeding two per cent ad valorem. The expression "scheduled goods" is defined under section 2(7) of the Act and means goods specified in the Schedule to the Act. Section 5 of the Act requires every registered dealer to submit a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the learned single Judge is under challenge. 4.. It was contended on behalf of the appellants that the learned single Judge failed to properly appreciate the contents of entry 11 and erroneously came to the conclusion that the list of scheduled goods set out in the entry is exhaustive in nature and not illustrative. It was contended that the expression "petroleum products" is generic in nature and furnace oil falls within the expression. The appellants further submitted that the reliance placed by the learned single Judge on the two decisions of the Supreme Court is not accurate because the entries in those cases were different and distinct. The learned counsel appearing on behalf of the respondent-company on the other hand, submitted that though the furnace oil does fall within the expression "petroleum products", the import of the furnace oil is not liable to duty as the list of scheduled goods set out under entry 11 is exhaustive. The learned counsel placed strong reliance upon the expression "that is to say" occurring in the entry and submitted that in view of the decisions of the Supreme Court, it must be concluded that furnace oil is not liable to duty in the absence of b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g petroleum products, if not used in the manufacture of fertilisers, are liable to payment of duty eventhough not specifically set out in the entry. The two products have been excluded if they are used in the manufacture of fertilisers and this, in our judgment, is the conclusive proof that the Legislature never intended that the petrol, diesel, crude oil, etc., exhaust the list of petroleum products in respect of which duties are payable. It is now well settled by catena of decisions that the entry must be read as a whole and it is not permissible to pick-up some words to ascertain the intention of the Legislature. We are conscious that being a taxing statute, the entry must be read strictly. But, we have no hesitation in concluding that the expression "All petroleum products", the expression "others" and the fact that some of the petroleum products, if used for a specific purpose, are excluded from levy, demonstrate the intention of the Legislature and leave no manner of doubt that the contention of the respondent-company that furnace oil not being specifically referred, is excluded from payment of duty, is incorrect. 5.. The learned counsel for the respondent submitted that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the words "that is to say" must vary with the context. It is, therefore, obvious that the Supreme Court clearly laid down that the expression "that is to say" need not in every case, conclude that the definition is exhaustive and eventhough the expression "that is to say" is used, whether the definition is illustrative, has to be determined with reference to the context in which the words are used and by examining the intention of the rule-maker. By considering the context in which the expression "that is to say" is used in entry 11, it must be concluded that the list of scheduled goods set out in the entry is merely illustrative and not exhaustive. The construction employed would subserve the object of the Legislature. 6.. The learned counsel also referred to the decisions of the Supreme Court in Sait Rikhaji Furtarnal v. State of Andhra Pradesh [1992] 85 STC 1 and in Royal Hatcheries Pvt. Ltd. v. State of Andhra Pradesh [1994] 92 STC 239; AIR 1994 SC 666. The first case does not set out the entry which came up for consideration and only refers to the earlier decision in the case of State of Tamil Nadu [1976] 37 STC 319 (SC); AIR 1976 SC 800 and holds that the expression "that i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d single Judge was in error in setting aside the order of the assessing authority levying penalty. We find considerable merit in the contention. The mere fact that entry 16-B underwent changes on three occasions, is not a sufficient ground for setting aside the penalty. The assessing authority had levied penalty as contemplated by section 5 of the Act. The respondent-company challenged the vires of the entry and when given up the challenge at the hearing of the petitions, it was not permissible to disturb the order of penalty levied by the assessing authority. The learned single Judge proceeded to quash the penalty levied in respect of duty payable for the import of furnace oil and that order is also required to be set aside in view of the finding that import of furnace oil was liable to payment of duty under entry 11 of the Second Schedule. It is not permissible in exercise of the writ jurisdiction to disturb the levy of penalty and the remedy of the assessee is to file appeal before the appellate authority as prescribed under the provisions of the Act. The learned counsel for the respondent submitted that the company would adopt such course, but it is possible that the appeals wi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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