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Synopsis

The Supreme Court has said that the 'tinted glass sheet', manufactured through a separate process, cannot be considered same as 'plain glass sheet' and thus would be liable for higher tax under the Uttar Pradesh Trade Tax Act, 1949.

A bench of Justices S Ravindra Bhat and Aravind Kumar declined to interfere with the Allahabad High Court's order which rejected a revision plea by Triveni Glass Ltd against the tax assessment orders for years 1996-97, 1998-99 and 2003-04.

The assessing officer imposed tax at the rate of 15% on the sale of the goods by holding that said goods cold not be included in the category of plain glass but under the category of “all goods and wares made of glass” as reflected in the Notification no 5784 dated September 7, 1981.

In its decision, the bench said that the argument that the “plain glass panes” would include ‘tinted glass sheet’ had to be rejected as the general meaning of “glassware” could not have been attached to ‘tinted glass’ sheet or the exclusion would have been specific in Entry (IV) itself. 

"In our considered opinion, the expression “all the goods and wares made of glass” occurring in Notification dated 07.09.1981 must be taken to refer to all articles of glass except those specifically excluded in the entry itself," the bench said.

Referring to the notification, the bench said that on a plain reading, it would leave no manner of doubt that all goods and wares made of glass would fall within the definition of the said entry or in other words, all goods and wares made of glass would fall within Entry No IV of the notification and thus attract a duty at the rate 15 %. 

The exclusion of plain glass panes, optical lens as indicated therein would fall within the residuary clause attracting 10 % tax, the bench added.

"There is no dispute to the fact that earlier the entry was “glassware” alone and the said entry was subsequently amended by adding word “all goods” within its scope and ambit and this widening of the expression would indicate the intention of the legislature to include all goods and wares of glass unless excluded, in other words the intention of the legislature is explicitly clear to include in its ambit any goods and wares made of glass," the bench said.

"The meaning of the word 'of' also acquires the significance," the bench further said, adding that the intention of the legislature of using this expression 'of' would reveal the purpose and it would be the endeavour of the court to put itself in the chair of the legislature and presume that the legislature was reasonable as held by the top court in Mauri Yeast India Private Limited Vs State of UP (2008) wherein the expression “chemicals of all kinds” was interpreted. 

The bench also said that it is well-settled principle that the word used in a statute must take its colour from the object it seeks to achieve and also by considering the words with which it is associated in the context.

"When the assessee is contending that an item/product falls under the residuary category, necessarily the burden is on the assessee to prove the said fact and in the instant case, the business premises of the appellant was inspected by Special Investigation Branch of the Department and it was revealed that “tinted glass sheet” was being manufactured through a different process," the bench said.

The bench held that there was no vagueness in the notification and the entry was clear and unambiguous namely it had brought within the sweep “all goods and wares made of glass” exigible to tax but not including “plain glass panes” and the exemption being the creation of the statute itself, it had to be construed strictly and even if there was any vagueness in the exemption clause must go to the benefit of the revenue.

The court also declared that neither the dictionary meaning nor the common parlance theory would come to the rescue of the appellant.

Case Title:  S Triveni Glass Ltd Vs Commissioner Trade Tax, UP