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TMI Blog2013 (8) TMI 868X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the goods may be charged under the charging section by exclusion or implication and in the present case it has to be considered on the touch stone of the charging section by implication. "Mediker" is basically a medicinal product but is used as shampoo, however, its period of treatment is four weeks and the shampoo is not used generally for washing hair and, therefore, the principle of ejusdem generis is not applicable (Grasim Industries Ltd. [2002 (4) TMI 52 - SUPREME COURT OF INDIA] relied on) and in this sense, it is not the cosmetic and, therefore, both respondents Nos. 2 and 3, Additional Commissioner of Commercial Taxes and Assistant Commercial Tax Officer have erred in charging Mediker and starch under the Entry Tax Act. Moreo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame relevant period under the Commercial Tax Act, 1994 (hereinafter called "the C.T. Act" for brevity), "Mediker" was an item chargeable (including surcharge) at 6.9 per cent up to December 1999 and at 9.2 per cent from January 2000 onwards, under the item "drugs and medicine" under Schedule II, Part VII. However, if the product is treated as shampoo, i.e., toilet or cosmetics then it is chargeable at 13.08 per cent and counsel urged that such a classification is not all attracted in the present case, since "Mediker" is an anti-lice treatment product. Secondly, "starch" although chargeable under the C.T. Act is not a "chemical". As per the counsel for the petitioner, chemical is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ercial Tax and respondent No. 2 upheld the order of respondent No. 3 vide annexure P/1. Respondent No. 2, however, treated Mediker as item of "drugs and medicine" chargeable at 6.9 per cent up to December 1999 and at 9.2 per cent for "starch" as "starch" and not as chemical under the Commercial Tax Act vide annexure P/5 and being aggrieved the petitioner has filed the present petition. The main contention of the counsel for the petitioner is that it is still the question whether the "Mediker" is to be classified under an item "drugs and medicine" under the M.P. Commercial Tax Act also and "starch" is not to be treated as the chemical under the E.T. Act. Counsel stated that once it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dered in this light. More or less the same principle is enunciated in the matter of Commissioner of Income-tax v. B.C. Srinivasa Setty [1981] 128 ITR 294 (SC); [1981] 21 CTR 138 (SC). Further counsel relied on Commissioner of Income-tax, Bombay City v. Elphinstone Spinning and Weaving Mills Co. Ltd. [1960] 40 ITR 142 (SC) to state that if the words of a taxing statute fail, then so must the tax. The courts cannot, except rarely and in clear cases, help the draftsmen by a favourable construction. Counsel submitted that an item Mediker was not mentioned any of the Schedules and if we look to the charging section in the tax, i.e., it fails and if the taxing statute fails, then so must the tax. Counsel also relied on the matter of Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... well-settled that if the collection machinery provided under the Act is such that it cannot be applied to an event, it follows that the event is beyond the charge created by the taxing statute and submitted that the E.T. Act could not apply beyond verge of the charging section. Counsel for the petitioner submitted that starch as well as Mediker has already been considered as being exempted for the E.T. Act by the Assistant Commercial Tax Officer in the case of the petitioner himself in the subsequent years 2000-01, 2001-02, 2002-03 and 2003-04 and in this light also the two articles are not under the purview of the Schedule II and do not attract the E.T. Act liability as held by the courts below. Per contra, counsel for the respondents/St ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eted. The apex court held already directed that the goods may be charged under the charging section by exclusion or implication and in the present case it has to be considered on the touch stone of the charging section by implication. "Mediker" is basically a medicinal product but is used as shampoo, however, its period of treatment is four weeks and the shampoo is not used generally for washing hair and, therefore, the principle of ejusdem generis is not applicable (Grasim Industries Ltd. [2002] 128 STC 349 (SC) relied on) and in this sense, it is not the cosmetic and, therefore, both respondents Nos. 2 and 3, Additional Commissioner of Commercial Taxes and Assistant Commercial Tax Officer have erred in charging Mediker and starc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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