9911796707
TMI Blog2009 (2) TMI 778X X X X Extracts X X X X X X X X Extracts X X X X ..... AND DIPAK CHAKRABORTI, JJ. DIPAK CHAKRABORTI (Technical Member). In this application, filed under section 8 of the West Bengal Taxation Tribunal Act, 1987, the applicants, namely, (1) Smt. Madhabi Rakshit, (2) Sri Netai Charan Rakshit, (3) Sri Prasanta Rakshit and (4) Sri Sushanta Rakshit, partners, carrying on business under the name and style of M/s. J.K. Rakshit Company at 113, Monohar Das Chowk, Kolkata 700 007, have raised a question as to whether silicon carbide paper and emery paper (paper coated abrasives) would fall within the entry made against serial No. 83(a) or 83(f) of Part I of Schedule C to the West Bengal Value Added Tax Act (in short, the VAT Act ) or alternatively whether those items would be covered by entry made against serial No. 53 of Part I of Schedule C to the VAT Act. Rate of tax applicable in both the cases would, however, remain the same, i.e., four per cent. The respondent-authorities are of the view that this should come under the residuary entry in Schedule CA to the VAT Act and exigible to tax at 12.5 per cent. The applicants made a reference to the Public Relations Officer, Directorate of Commercial Taxes, Government of West Bengal, on J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same class would come under the purview of the respective entries. In support of his submission, learned advocate relied on a decision of the honourable Orissa High Court in the case of Foremost Dairies Limited v. State of Orissa [1993] 88 STC 535. Relying on that decision, learned advocate argued that item (a) of the entry at serial No. 83 is an entry mentioning divergent goods. It was submitted that goods up to grinders mentioned in the item (a) were tools themselves and would fall within the category of tools using power (power tools) and other remaining items of the said entry would not fall within the category of power tools per se. Abrasives irrespective of their types are per se not capable of being power driven. They are fitted in different machines or tools which are driven by power. Contention of the learned advocate was that the items in question (paper coated abrasive) not capable of using power independently would fall within the expression super-abrasives, non-woven abrasives and bonded abrasives . The community of power, therefore, in view of the fact that item (a) of the said entry indicates different goods, does not apply to abrasives. The learned advocate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... voices that not only Carborundum Universal Limited but also other dealers too charged VAT at four per cent on coated abrasive paper. It was also contended by the learned advocate that reliance placed by the respondent-authorities on the Central Excise and Tariff Act was unnecessary when proper classification under the VAT Act was available. The learned State Representative appearing on behalf of the respondentauthorities contested the application on behalf of the respondent-authorities and submitted that silicon carbide, waterproof paper, being dealt in by the applicants would not fall within the entry made in serial No. 83(a) or 83(f) or 53 of Part I of Schedule C to the VAT Act. He asserted that the item would come as a residuary item under Schedule CA to the VAT Act. Relying on a publication of Ministry of Industries, Government of India (Project Profile, Volume II, published by Development Commissioner, Small Scale Industries, page 561), learned State Representative submitted that coated abrasives are paper and clothes coated with cattle hide glue, shellac or technical gelatine adhesive and covered with abrasives grains. Coated abrasives, include sand paper, emery paper, eme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner that item in question could also be treated as an item falling under 83(f) of Part I of Schedule C to the VAT Act, learned State Representative submitted that the items, such as, spanners, pliers, screw drivers, chisels have been included therein along with tools for carpentry or tools for masons. He wanted to emphasize that hand tools which could be reused would only come under that category. His submission was that tools for carpentry or tools for masons would only include tools having the properties similar to those of chisels, spanners, hammers, etc., with reference to durability and period of re-use. It was his assertion that coated abrasive paper could be used for once only and not durable like other items as mentioned in entry 83(f). The learned State Representative further drew our attention to entry 197 of Schedule IV to the West Bengal Sales Tax Act, 1994 (in short, the 1994 Act ). The entries made against 83 of Part I of Schedule C to the VAT Act are identical to the entries made against serial No. 197 of the 1994 Act. In addition to this, there was a specific entry No. 11 in Schedule VIIIA to the 1994 Act. The said entry was in respect of hardware ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proof paper is different from paper and other items as mentioned in serial No. 53 of Part I of Schedule C to the VAT Act. As per his submission coated paper (i) is paper which has been coated by an inorganic compound to impart certain qualities of the paper including weight and surface gloss, smoothness or ink absorbency. (Wikipedia, Free Internet Encyclopedia) ; (ii) is paper with a clay or other coating applied on one or both sides. Coated paper generally produces sharper, brighter images and has better reflectivity than uncoated papers. (Abont.Com, Desk Top Publishing, Internet Information Bank) . Relying on these two definitions of coated paper, it was argued by the learned State Representative that silicon coated water-proof paper should not be treated at par with paper as commonly understood by the dealers dealing in such items. He also drew our attention to the letter dated July 18, 2006 of the Assistant Commissioner of Commercial Taxes, Public Relations wherein the said authority while replying to letter dated June 23, 2006, addressed to him by the applicants only indicated the rate of tax on items mentioned in the said letter dated June 23, 2006. In the said letter, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at was purely a simple direction. Question, therefore, boils down to the determination whether silicon carbide paper and emery paper would fall within the category of power tools (item 83(a) of Part I of Schedule C to the VAT Act) or hand tools (item 83(f) of Part I of Schedule C to the VAT Act) or paper (item 53 of Part I of Schedule C to the VAT Act). Distinction between power tools and hand tools has been explained as below in the New Encyclopaedia Britannica Micropaedia, volume 28, 15th edition, pages 712 and 728: A tool is an implement or device used directly upon the piece of material to shape it into a desired form . . . Hand tools are those used by craftsmen in manual operations, such as chopping, chiseling, sawing, filing or forging. Complementary tools often needed as auxiliaries to the shaping tools include such implements as the hammer for nailing and the vise for holding. A craftsman may also use instruments that facilitate accurate measurements, the rule, dividers, square and others. Power tools usually hand-hold motor powered implements, such as, electric drill or electric saw perform many of the old manual operations and as such may be considered as hand t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry 83(a) of Part I of Schedule C to the VAT Act? The explanation as given in Encyclopedia Britannica, volume I, page 38 as referred to hereinbefore indicates that machines are required to utilize abrasives. Abrasives can very well be classified as tools used for polishing and grinding. It is extensively used for grinding and polishing automobile, furniture, leather, cases of electrical household appliances and mechanical components. Silicon carbide water proof paper is best for wet and dry sanding of metal, paints and plastics. It leaves an excellent finish on most precious metals. But it has no independent use as power driven tools. It must have to be fitted in a machine. Upon comparison of the entries made against 83(a) and 83(f), it appears that mode and manner of use of the items listed against those entries have played decisive role in placing the items in a particular category. It is to be noted that hammers and screw drivers have been placed in the category of power tools as well as in the category of hand tools. This clearly means that hammers and screw drivers when used with the aid of power they become power tools and when such items are used manually they are treat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t page 537 of 88 STC): 5. The use of the expression 'such as' has to be read in the context in which it is used. Where divergent articles are indicated, the situation may be different from one where only similar articles are indicated. To illustrate, the case of 'food and beverages' may be taken. In rule 93K 'food and beverages' in sealed containers such as Maltodex, Maltova, Horlicks, Viva, Complan, Bournvita, condensed milk have been indicated. They belong to a class. We have observed in the case of State of Orissa v. Jyoti Trading Company [1993] 88 STC 530 (Orissa) (S.J.C. No. 15 of 1987 decided on July 7, 1992) that jam, jelly, tomato sauce and squash are not covered by item 4 of rule 93K for levy of tax at the first point of sale as they do not belong to the indicated class. The context in which the expression 'such as' is used is of vital importance. In the context of divergent articles being covered, serial 30D of the list of goods exempted from sales tax in terms of Notification No. 20206-CTA-14/76 dated April 23, 1976 is relevant. The entry relates to sale of 'feed and fodder' such as husk straw, hay, grass, oil-cake and manuf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly known as paper coated abrasives, do not fall within the scope and ambit of power tools. Next question is whether these items would fall within entry 83(f) which deals with hand tools. The items mentioned therein are spanners, pliers, screw drivers, hammers, torque tools, chisels, drill bits and burrs, tool bits, hacksaws, hacksaw blades and frames, band-saw rolls, dice, die-nuts, tools for carpentry, tools for masons and steel files. The learned State Representative during the course of his submission stressed that tools are articles which could be re-used, repaired and could perform repetitive functions. It was contended by him that tools for carpentry and tools for masons would only include tools having similar properties, namely, durability and ability to be used for repetitive functions. It was pointed out by him that disputed items, silicon carbide paper and emery paper (paper coated abrasives), would become useless after single use and, not being identical to other items mentioned therein, should not be treated as hand tools . We have already observed that a tool is an implement or device used directly upon the piece of materials to shape it into a desired form ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch specific entry under the VAT Act like the entry made against serial No. 266 of Schedule IV to the 1994 Act. We have to concentrate only to the entries made under Part I of Schedule C to the VAT Act. In view of the facts and circumstances of the case and keeping in mind the use of the items in question, we are of the view that these items would fall within the entries tools for carpentry and tools for masons . The learned State Representative also drew our attention to the codes assigned to various items under the Central Excise and Tariff Act. We do not think that those are very relevant for the purpose of determination as to whether the items in question would fall within the entries made under Part I of Schedule C to the VAT Act. Though we have already held that the items in question, namely, silicon carbide paper and emery paper would come within the entries tools for carpentry and tools for masons , we would be failing in our duty if we do not offer our views as to whether the items in question would be treated as an item falling under entry against 53 of Schedule C to the VAT Act. In the case of State of Uttar Pradesh v. Kores (India) Ltd. reported in [1977] 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
