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TMI Blog2018 (7) TMI 837X X X X Extracts X X X X X X X X Extracts X X X X ..... e that the sellers are engaged in sale or paints or enamels. Goods grouped in Entry 18(II) and (III) of Part E of the 1st Schedule, relate to paints and enamels not otherwise specified in this schedule including powder paints, stiff paste paints and liquid paints; colours; and pigments, including water pigments and leather finishes. In Tejraj Paramel v. State of Orissa [1994 (11) TMI 406 - ORISSA HIGH COURT], it is held that the meaning of the word has to be judged by the company it keeps. When the group of words in Entry 16 of Part C of the 1st Schedule speaks of dyes, which is soluble, the goods mentioned in Entry 18(II) and (III) of Part A of the 1st Schedule, relate to paints and enamels, colours, pigments, etc. As rightly observed by the Tribunal, Legislature has grouped the goods, dyes in a different entry than paints, enamels, powder paints, colours and pigments, etc. Approach of the Tribunal in ascertaining the legislative intent with reference to the disputed word and scrutiny of the purchase invoices of the assessee, to ascertain the goods purchase and sold, to arrive at a conclusion that the goods sold are 'dyes', taxable at 8% as per Entry 16 of the Part C of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e including powder paints, stiff paste paints and liquid paints ii. Colours iii. Pigments, including water pigments and leather finishes iv. ...... v. ...... vi. ...... vii. ...... viii. ...... ix. ...... x. ...... xi. ...... xii. ...... The appellants have purchased Rhodamines, Autamine Victoria Blue, Pigment Powder, Methylene Violet, Oil Blue, Oil Green and Cro Scarlet from outside the State during the year 2000-01 and sold locally charging tax at 8% as dyes. The Assessing Officer had also assessed the said turnover of ₹ 7,52,965.00 to tax at 8% as the commodity dyes falls under entry 16 of Part C of First Schedule by his proceeding dt. 10-10-2001. However he reversed his earlier stand and classified the said commodity under entry 18(ii) of Part C of First Schedule taxable at 16% as pigment and colours and passed a revised order to that effect by assessing the turnover of ₹ 7,52,965.00 to tax at 16% which is impugned in this appeal. 5. It is well settled by catena of cases of the Apex Court of the country that in interpreting the meaning of the words in taxing statues we should not be guided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T.A.No.544 of 2006 before the Tamil Nadu Sales Tax Appellate Tribunal (Additional Bench), Chennai, on the question, as to whether, dyes and chemicals sold by the respondent are taxable at 8%, under Entry 16 Part 'C' of the First Schedule of the Tamil Nadu General Sales Tax Act, 1959 or as colours, taxable at 16% coming under Entry 18(ii) of Part 'E' of the First Schedule of the Tamil Nadu General Sales Tax Act, 1959, and thus, the State has questioned the correctness of the order of the Appellate Assistant Commissioner (CT) in allowing the appeal, filed by the assessee. Vide order, dated 26.08.2011, the Tamil Nadu Sales Tax Appellate Tribunal (Additional Bench), Chennai, dismissed the same, as follows: 9. We have the arguments of both sides and perused connected records. 10. The grounds of State appeal written argument of the learned counsel for he respondents and the order of the Assessing Officer and Appellate Assistant Commissioner (CT). It is pertinent to point out that the Appellate Assistant Commissioner (CT), in his order has clearly discussed the difference between the levy of tax 8% and 16% dyes and chemicals and the observation furnished below ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pigment red etc, are used to convey colouring, by particular colour. There are meaning of a particular word is of a wider import, the legislative intent should be ascertained by reference to adjoining words in connection with which the disputed word is used, for the simple reason, that such adjoining words lend their colour and meaning to the disputed word. Here it should be noted that unlike the entry for dyes, the entry for pigment is associated with paints and other allied products as seen from Entry 18 (ii) or Part E of First Schedule. Dye is not a basic chemical but it is an intermediary chemical product which can be utilized as such, the legislature has grouped dyes of different kinds to be taxed at 8%. The appellants have sold Rhodamine, Auramine, victoria blue, Methylene violet, oil blue, oil green and cro scarlet. These items fit into the description of dyes as provided under Entry 16 of Part C to First Schedule since what the appellants have sold are basic dyes and acid dyes. The scrutiny of copies purchase invoices filed by the Authorised Representative in support of his stand would indicate the Central Excise classification of the commodity under the ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sold by the dealer/assessee is synthetic agro dyes and as such, it shall be treated as dyes and chemicals. 7. Learned Additional Government Pleader (Taxes) further submitted that the Tribunal ought to have held that pigment brown, pigment yellow etc., are used to convey coloring, by a particular colour in the product, whereas, dyes is intermediary chemical product. He further submitted that the goods sold by the dealer/assessee are classified as colours, falling under Entry 18 (ii) of Part E of 1 Schedule and therefore, liable to tax at 16%. 8. He further submitted that each commodity sold by the assessee-dealer is to add the required colour in the finished product of the customers and therefore, the commodity is nothing but colour and pigments. He further submitted that the Tribunal has erred in holding that the pigment is associated with paints and other allied products and goods sold by the assessee/dealer falls under Entry 16 of Part C of 1st Schedule and is liable to tax at 8% as dyes. He also submitted that the Tribunal has erred in holding that invoices filed by the assessee indicate that the products are falling under Central Excise classification tariff sub heading 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : die.(OE deagian deag dye, color) Pigment 1.Any of a class of finely powered, insoluble coloring matters suitable for making paints, enamels, oil colors, etc. 2 Any substance that imparts color to animal or vegetable tissues, as chlorophyll. 3.Any substance used for coloring. 12. In order to ascertain the actual nature of goods purchased and sold by the assessee, we called for the assessment files of the dealer. Perusal of the same shows that during the assessment year 2000-01, most of the purchases are made from Ahmadabad, Mumbai, Sinnar and other places and a cursory look at the interstate purchase details, reveals that the sellers are mostly dealing with chemicals and to name a few., Aspit Enterprises, Ahmadabad, Shree Dye Chemicals, Ahamadabad, Tirupati Dye Stuff, Ahmadabad, etc. 13. Similarly, perusal of the local sale purchases, also reflect purchase from sellers, dealing with chemicals. Details found in the assessment file, do not suggest strong evidence that the sellers are engaged in sale or paints or enamels. Goods grouped in Entry 18(II) and (III) of Part E of the 1st Schedule, relate to paints and enamels not otherwise specified in this schedule includ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bborn; cross or petulant. 5. Stroud's Judicial Dictionary of Words Phrases, Fourth Edition PERVERSE: A perverse verdict may probably be defined as one that is not only against the weight of evidence but is altogether against the evidence. .......... 29. In Kuldeep Singh v. The Commissioner of Police, (1999) 2 SCC 10, the Court while dealing with the scope of Articles 32 and 226 of the Constitution observed as under: 9. Normally the High Court and this Court would not interfere with the findings of fact recorded at the domestic enquiry but if the finding of guilt is based on no evidence, it would be a perverse finding and would be amenable to judicial scrutiny. 10. A broad distinction has, therefore, to be maintained between the decisions which are perverse and those which are not. If a decision is arrived at on no evidence or evidence which is thoroughly unreliable and no reasonable person would act upon it, the order would be perverse. But if there is some evidence on record which is acceptable and which could be relied upon, howsoever compendious it may be, the conclusions would not be treated as perverse and the findings would not be int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ragraph 30, the Hon'ble Supreme Court, held as follows: 30. The findings of fact recorded by a court can be held to be perverse if the findings have been arrived at by ignoring or excluding relevant material or by taking into consideration irrelevant/inadmissible material. The finding may also be said to be perverse if it is against the weight of evidence, or if the finding so outrageously defies logic as to suffer from the vice of irrationality. If a decision is arrived at on the basis of no evidence or thoroughly unreliable evidence and no reasonable person would act upon it, the order would be perverse. But if there is some evidence on record which is acceptable and which could be relied upon, the conclusions would not be treated as perverse and the findings would not be interfered with. 18. Approach of the Tribunal in ascertaining the legislative intent with reference to the disputed word and scrutiny of the purchase invoices of the assessee, to ascertain the goods purchase and sold, to arrive at a conclusion that the goods sold are 'dyes', taxable at 8% as per Entry 16 of the Part C of the 1st Schedule, cannot be said to be perverse. 19. On the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X
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