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TMI Blog2009 (4) TMI 1018X X X X Extracts X X X X X X X X Extracts X X X X ..... edule consists of thre e parts-Part A, Part B and Part C which deal with different items chargeable to tax at the rate of 4%. The Third and the Fourth Schedule which would not be rele vant for the present adjudication deal with gold, silver, ornaments, jewellery e tc. etc. which are chargeable to tax at the first point of sale. The Fifth Sche dule includes within its fold, works contract, lease transactions and all other goods not covered by the first, second, third and fourth schedule . 3. Entry 80 of Part A of the Second Schedule at the relevant time w as in the following terms : 80. Processed or preserved vegetables fruits including fruit jam, jelly, p ickle, fruit squash, paste, fruit drink and fruit juice. 4. The petitioner Company, who claims to have consistently classifi ed the potato chips manufactured by it under the aforesaid Entry 80 of Part A of the Second Schedule and collecting and paying the Value Added Tax (VAT) at th e rate of 4% on the turn over relating to sale of potato chips , received a com munication dated 5.2.2007 from the jurisdictional Superintendent of Taxes, Guwah ati seeking to raise a demand for payment of differential tax of 8.5% on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said Entry. In this regard, the learned counsel has pointed out t hat processed or preserved fruits and vegetables at one point of time specifical ly excluded jams, jelly, pickles, fruit squash, paste, fruit drinks and fruit ju ice which items were, however, included with effect from 5.12.2005. The definiti on of processed or preserved fruit and vegetables, therefore, according to the l earned counsel, became an inclusive definition taking within its compass all oth er 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 wi th effect from 16.10.2008 while the said Entry continued to include jam, jelly, pickles etc. 8. 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 ent ry. The learned counsel further contended that in several States the same produc t has been classified under the specific entry of the VAT Act in force in the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t ato chips as an item of processed vegetable. The purport and effect of an inclu sive definition has also been sought to be explained by the learned counsel on t he basis of several decisions of the Apex Court, specific details of which, howe ver, 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. -vs- Stat e of Uttar Pradesh Anr., reported in (2008) 5 SCC 680 to contend that in the p resent 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 t he law laid down by the Apex Court in the above case, should go in favour of the assessee i.e. the revision petitioner herein. 11. The arguments advanced on behalf of the petitioner have been veh emently resisted by Sri D. Saikia, learned counsel appearing for the respondents . Placing before the Court certain literature circulated by the petitioner on it s web site, Sri Saikia has pointed out that it is the case of the petitioner tha t potato chips is a snack item and not a processed vegetable item. Sri Saikia has submitted that the proces ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reference to jams, jelly, pickle etc . is illustrative and comprehensive to include only the items specifically menti oned and no other item. In this regard, reliance has been placed on a judgment o f the Apex Court in the case of Reserve Bank of India -vs- Peerless General Fina nce Investment Co. Ltd Ors. reported in (1987) 1 SCC 424. Sri Saikia has fu rther submitted that the specific exclusion of potato chips from Entry-80 with effect from 16.10.2008 is merely clarificatory. According to Sri Saikia, the am endment of Entry-80 to the above effect has made it explicit what was always imp licit. 13. The rival submissions advanced on behalf of the parties have rec eived our most anxious consideration. The basic approach while dealing with claims and counter claims of classificatio n under the main and residuary item of tariff has been explained by the Apex Co urt in Dunlop India Ltd. Anr. -vs- Union of India Ors., reported in 1983 (13 ) E.L.T 1566 (S.C.) 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 principle of classification to deny it the parentage and con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rect to hold that potato chips , though not specifically included, yet, as the same has not been excluded either, would come within the inclusive definition of processed vegetable or fr uit so as to fall under Entry 80 of Part A of the Second Schedule to the Act. 16. The argument advanced by Sri Saikia, learned counsel for the res pondents by placing reliance on the decision of the Apex Court in Reserve Bank o f India -vs- Peerless General Finance Investment Company Ltd. (supra) 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 u nderstood 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 th e legislative resorts to the inclusive definition are made : (1) to enlarge the meaning of words or phrases so as to take in the ordinary, p opular and natural sense of the words and also the sense which the statute wishe s to attribute to it, (2) to include meanings about which there might be some dispute, or, (3) to bring under one nomenclature all transactions p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opular sense .. This rule was stated as early as 1831 by Lord Tenterde n in Attorney-General v. Winstanley (1). Similarly, in Grenfell v. Inland Revenu e Commissioner(2), Pollock. B, observed, that if a statute contains language wh ich is capable of being construed in a popular sense such statute is not to be c onstrued 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 wo rds popular sense , that sense which people conversant with the subject-matter with which the statute is dealing would attribute to it . (Commissioner of Sales Tax, Madhya Pradesh, Indore -vs- Jaswant Singh Charan Singh. 19 STC 469 (SC)). However, in Collector of Central Excise, Kanpur -vs- Krishna Carbon Paper Comp any (supra), 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 artifi cial definition is being given to the words or a special meaning is attached to such words, in such a situation, the ordinary or dictionary meaning would not be applicable and the special meaning must be allowed to prevail. The following ob s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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