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TMI Blog2015 (9) TMI 778X X X X Extracts X X X X X X X X Extracts X X X X ..... e said Act, Tribunal was correct in holding that the product 'Ice cream' manufactured by the applicant was not covered by the term Sweet and Sweetmeats appearing in both the aforesaid entries and thereby impugned item 'Ice cream' was not eligible for the tax concession? 2. The factual backdrop on which the above question has been referred needs to be noted. The applicant assessee is a registered dealer under the Bombay Sales Tax Act,1959 (For short the Act ) and manufacturer of 'Ice cream' which is covered of Schedule Entry C-II- 35(1) . The Government of Maharashtra had issued a Notification under Section-41 of the Act with effect from 1st April, 1994 and introduced Entry 374 under which the effective rate of tax was reduced to 4% in respect of Sweet and Sweetmeats covered by Schedule Entry C-II- 35(1) . 3. In view of the notification providing for a reduced rate of tax, on 31st December, 1994, the applicant filed an application under Section 52 of the Act before the Commissioner praying that the effective tax rate in respect of sales on Ice cream made by the applicant under Invoice 292 dated 1st May, 1994 be determined. This application cam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing icecream or kulfi. Eight paise in the rupee Eight paise in the rupee (2) Sweet drops, toffees and chocolates. Do. Do 7. By a Government Notification dated 8th April, 1994 Entry No.374 was issued under Section 41 of the Act whereby a concessional rate of tax came to be introduced in respect of 'sweet and sweetmeats' as covered under Schedule Entry C-II-35(1) . It is this notification entry of which the applicant has sought a benefit in respect of sale of 'Ice-cream' as the tax was 4% in place of 8% as prescribed under regular entry No. C-II-35(1) . Notification Entry 374 reads as under:- 374 Sales or Purchases of Sweets and sweetmeats covered by sub entry (1) of entry 35 in Part II of Schedule-C To the extent to which the amount of sales tax or as the case may be purchase tax exceeds four paise in the rupee Nil. Government Notification F.D.No.STA- 1094/12/Taxation- 2 dated 8.4.94. 8. On behalf of the applicant, it is contended that the legislative backgrou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uding shrikand, basundi, and doodhpak , in schedule entry C-II-35 (1) inserted in the amendment Act of 1981 cannot be relied upon de'hors the interpretation as made by the revenue to include icecream as sweet and sweetmeat. The use of semicolon as above would not separate ice-cream from sweet and sweetmeat so as to say that 'Ice-cream' is separated and forms a separate entry. (iv) As understood in common parlance, 'Ice-cream' is consumed as a sweet and that therefore, it is required to be treated as part of sweet and sweetmeats . (v) A plain reading of the schedule entry C-II-35(1) leads only to one conclusion that it is inclusive entry and covers various items which would form part of sweet and sweet-meats which includes 'Ice-cream'. Other items being shrikand, basundi and doodhpak, cakes, pasteries, biscuits, kulfi and non-alcoholic drinks containing Ice-creams or kulfi. All these items are sweet and therefore, ''Ice-cream' is required to be treated as a sweet. (vi) When two meanings are possible then a meaning which is favourable to the assessee is required to be applied and thus notification entry No.374 which prescribes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the same entry namely entry C-II-35 (I), cannot be read to be sweet and sweetmeats for the purpose of concessional rate of tax as available under notification entry 374. Mr. Sonpal submits that the use of semicolon and the use of word 'and' as contained in entry C-II-35 (1) clearly reveals the legislative intent to treat sweet and sweetmeats different from cakes, pastries and biscuits as also confectioneries, ice- cream and kulfi and non-alcoholic drinks containing ice-creams or kulfi. Mr. Sonpal submits that it is in fact for these reasons in entry C-II-35 sweet drops, toffees, and chocolates has been separated by providing sub clause (2) . Mr. Sonpal submits that the contention on behalf of the applicant is too far stretched and in fact would do violence to the plain language and the legislative intent as contained in notification entry 374, which is only to make available concessional rate of tax to sweet and sweetmeats which would include items like shrikand, basundi and doodhpak. It is submitted that the intention of legislature is basically to grant benefit to items like shrikand, basundi and doodhpak which are items of common and mass consumption than other i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udes items like cakes, pastries, biscuits and other confectioneries. These items form the second category. A plain reading of the items in the second category makes it quite clear that all these are items connected and commonly sold in bakery establishments. The third category contains the item in dispute namely ice cream along with kulfi and non-alcoholic drinks containing ice-creams or kulfi. The third category therefore, is quite distinct and different from the first two categories of this entry. A careful examination of these three categories indicates that the items contained therein are distinct from each other. We would interpret the entry by giving to its contents a plain and natural meaning and as to how the items would be commonly understood. When the entry uses the word sweet and sweet meats to include shrikand, basundi and doodhpak, we would have no hesitation to come to a conclusion that the words sweet and sweet meat would include only such other items which would be of a category akin to the items contained in the entry namely shrikand, basundi and doodhpak. We may also observe that a distinct feature of the first category of the entry is that these are of cat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o icecream which falls in third category of entry C-II 35 (1) nor can it be included in the second category namely cakes, pasteries, biscuits etc. and thus the applicant would not be correct in contenting that the benefit of notification entry 374 would be available to the applicant in sale of 'icecream' undertaken by it. 17. Mr. Joshi, learned counsel for the petitioner in support of his submissions has placed reliance on the decision of the Division Bench of this Court in the case of Commissioner of Sales Tax vs. Kwality Frozen Foods Ltd. (supra). The issue in this case had arisen from the very same decision of the Tribunal as in the present case whereby in regard to the applicant as also the companion litigants the Tribunal had directed prospective effect to be given to the orders passed by the Commissioner who had declined the benefit of the concessional rate of tax under notification entry 374 on sale of ice-cream. The Revenue had challenged this direction in an appeal before this Court. The Division Bench upheld the decision of the Tribunal accepting the contention on the part of the assessee that historically 'Ice-cream' was treated to be a part of entry C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich exemption was sought read as follows :- Cooked food and non alcoholic drink is served at one time at a price of not more than one rupee per person, for consumption at or outside any eating house, restaurant, hotel, refreshment room or boarding establishment which is not a shop or establishment conducted primarily for the sale of sweetmeats, confectionery, cakes, biscuits or pastries. . On this background, the Division Bench held that entry 14 exempted cooked food subject to conditions contained therein and held that it would be wholly wrong to cut down the ambit of the exemption granted by the said entry to what can be eaten only at fixed hours of the day or in the course of a regular breakfast, lunch or dinner. What was observed was that the entry does not mention of a Meal . It uses the word food to distinguish it from 'drink' namely what one can eat. It was thus, observed that 'Ice-cream' sold by the assessee could be consumed by the customers of the assessee in the assessee's depots. The question as referred was thus answered in the affirmative. We do not see how the judgment would assist the applicant in the present context. The entry which fell for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and Sweetmeats . It was observed that the term Sweet is a wider generic term, which comprehends within it the species of sweets known as sweetmeats, but from this it does not follow that every sweet is a sweetmeat. It was observed that words sweet food are merely descriptive of a sweet and a sweetmeat ', and do not define or bring out the essential distinction between the two. It was observed that the shorter Oxford English Dictionary defines Sweetmeat as preserved or candied fruits, sugared nuts, etc.; also, globules, lozenges, drops , or sticks made of sugar with fruit or other flavoring or filling . It was observed that sweet which is not a sweetmeat and a sweetmeat both normally taste sweet, but all that tastes sweet is not and cannot be sweetmeat, and both on dictionary meaning and according to the commonly understood notions of what an ice-cream is and what sweetmeats are. The Division Bench did not accept the submission on behalf of the Revenue that 'Ice cream' is a sweetmeat. We fail to appreciate as to how this Judgment would support the case of the applicant. In fact, it completely supports the Revenue inasmuch as the Division Bench has categorical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... who ordinarily deal with them . In that case, the question that had arisen for consideration was whether non- alcoholic beverage bases are food products or food preparations in terms of the Central Excise Notification No.55/75 dated March 1, 1975. This Court observed that non alcoholic beverages are not understood in India as food products or food preparations, though they might have been regarded as such in foreign countries. The High Court, therefore, should have applied the rest of popular parlance by finding out how toffee is understood in the country and more particularly in the State of U.P. No evidence was led by the State to substantiate its case that toffee is considered as sweetmeat either by the dealers in toffees or by the consumers. On the other hand, evidence was led by the appellant in C.A.N.1692 of 1997 indicating that toffee is not considered as sweetmeat, that they are not sold in shops selling sweetmeats but are sold in shops selling confectioneries or other types of goods, and that the consumers do not buy toffees as sweetmeat or treat them as such. It was, however, contended by the learned counsel for the State that sometime before this exemption notification ..... 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