9911796707
TMI Blog2009 (4) TMI 853X X X X Extracts X X X X X X X X Extracts X X X X ..... d Schedule consists of three parts-Part A, Part B and Part C which deal with different items chargeable to tax at the rate of four per cent. The Third and the Fourth Schedule which would not be relevant for the present adjudication deal with gold, silver, ornaments, jewellery, etc. etc., which are chargeable to tax at the first point of sale. The Fifth Schedule includes within its fold, works contract, lease transactions and "all other goods not covered by the First, Second, Third and Fourth Schedules". Entry 80 of Part A of the Second Schedule at the relevant time was in the following terms: "80. Processed or preserved vegetables and fruits including fruit jam, jelly, pickle, fruit squash, paste, fruit drink and fruit juice." The petitioner-company, who claims to have consistently classified the "potato chips" manufactured by it under the aforesaid entry 80 of Part A of the Second Schedule and collecting and paying value added tax (VAT) at the rate of four per cent on the turnover relating to sale of "potato chips", received a communication dated February 5, 2007 from the jurisdictional Superintendent of Taxes, Guwahati, seeking to raise a demand for payment of differential tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the court to the amendments made in respect of the said entry. In this regard, the learned counsel has pointed out that processed or preserved fruits and vegetables at one point of time specifically excluded jams, jelly, pickles, fruit squash, paste, fruit drinks and fruit juice which items were, however, included with effect from December 5, 2005. The definition of "processed or preserved fruit and vegetables", therefore, according to the learned counsel, became an inclusive definition taking within its compass all other species including "potato chips" belonging to the common genus of "processed vegetables". This, according to the learned counsel, has been clearly manifested by the specific exclusion of the "potato chips" from the purview of entry 80 with effect from October 16, 2008 while the said entry continued to include jam, jelly, pickles, etc. Sri Lodha, learned Senior Counsel for the petitioner, has further pointed out that if any particular item is classifiable under a specific entry in a Schedule, such item, or commodity must not be relegated to the residuary entry. The learned counsel further contended that in several States the same product has been classified unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition should not cover "potato chips" as an item of processed vegetable. The purport and effect of an inclusive definition has also been sought to be explained by the learned counsel on the basis of several decisions of the apex court, specific details of which, however, need not be noticed. The learned counsel for the petitioner has also relied on a recent decision of the apex court in Mauri Yeast India Pvt. Ltd. v. State of U.P. reported in [2008] 14 VST 259; [2008] 5 SCC 680 to contend that the present case even if there is any doubt as to which of the entries would attract the particular product in question, the benefit of such doubt, on the ratio of the law laid down by the apex court in the above case, should go in favour of the assessee, i.e., the revision petitioner herein. The arguments advanced on behalf of the petitioner have been vehemently resisted by Sri D. Saikia, learned counsel appearing for the respondents. Placing before the court certain literature circulated by the petitioner on its web site, Sri Saikia has pointed out that it is the case of the petitioner that "potato chips" is a snack item and not a processed vegetable item. Sri Saikia has submitted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... definition of the expression "processed vegetable" by contending that the reference to jams, jelly, pickle, etc., is illustrative and comprehensive to include only the items specifically mentioned and no other item. In this regard, reliance has been placed on a judgment of the apex court in the case of Reserve Bank of India v. Peerless General Finance and Investment Co. Ltd. reported in [1987] 1 SCC 424. Sri Saikia has further submitted, that the specific exclusion of "potato chips" from entry 80 with effect from October 16, 2008 is merely clarificatory. According to Sri Saikia, the amendment of entry 80 to the above effect has made it explicit what was always implicit. The rival submissions advanced on behalf of the parties have received our most anxious consideration. The basic approach while dealing with claims and counter-claims of classification under the main and residuary item of tariff has been explained by the apex court in Dunlop India Ltd. & Madras Rubber Factory Ltd. v. Union of India reported in [1983] 13 ELT 1566 in the following manner: "... When an article is by all standards classifiable under a specific item in the tariff Schedule it would be against the very p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ems specifically included under entry 80. In such a situation, we are of the view that it would be correct to hold that "potato chips ", though not specifically included, yet, as the same have not been excluded either, would come within the inclusive definition of "processed vegetable or fruit" so as to fall under entry 80 of Part A of the Second Schedule to the Act. The argument advanced by Sri Saikia, learned counsel for the respondents, by placing reliance on the decision of the apex court in Reserve Bank of India v. Peerless General Finance and Investment Co. Ltd. [1987] 1 SCC 424 that in the present case the word "including" appearing in entry 80 was intended not to expand the meaning of processed vegetable or fruit and such expansion must be understood to be limited to the items specifically mentioned in the said entry 80, may now be considered. In the aforesaid case, the apex court laid down that the legislative resorts to the inclusive definition are made: "(1) to enlarge the meaning of words or phrases so as to take in the ordinary, popular and natural sense of the words and also the sense which the statute wishes to attribute to it, (2) to include meanings about which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dinary words in every day use, such words should be construed according to their popular sense ... This rule was stated as early as 1831 by Lord Tenterden in AttorneyGeneral v. Winstanley [1831] 2 Dow. & Cl 302. Similarly, in Grenfell v. Inland Revenue Commissioners [1876] 1 Ex. D 242, 248, Pollock. B, observed, 'that if a statute contains language which is capable of being construed in a popular sense such statute is not to be construed according to the strict or technical meaning of the language contained in it, but is to be construed in its popular sense, meaning of course, by the words "popular sense", that sense which people conversant with the subjectmatter with which the statute is dealing would attribute to it'." Commissioner of Sales Tax, Madhya Pradesh, Indore v. Jaswant Singh Charan Singh [1967] 19 STC 469 (SC). However, in Collector of Central Excise, Kanpur v. Krishna Carbon Paper Co. [1989] 72 STC 280; [1989] 1 SCC 150, the apex court after reiterating the aforesaid proposition hastened to add a note of caution to the effect that if it is discernible that an artificial definition is being given to the words or a special meaning is attached to such words, in su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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