IMPORTANT POINTS
Entry 22 of Schedule II of the VAT Act, 2008 does not exclude or specify that it would not include bitumen of all types and varieties.
Where the goods are identically understood in commercial or business parlance the generic entity would be construed as including the goods in question.
Entry 22 using the word "bitumen" without any further stipulation or qualification covers bitumen emulsion.
Residuary Entry would be applicable only to goods failing the three-fold criteria.

JUDGMENT

Dipak Misra, J. –

In this appeal, by special leave, the Revenue has called in question the legal sustainability of the judgment and order passed by the High Court of Judicature at Allahabad in Commercial Tax Revision no. 1156 of 2009 preferred by the assessee-respondent under Section 11 of the U.P. Trade Tax Act, 1948 (for brevity, `the 1948 Act') read with Sections 81 and 58 of the VAT Act, 2008 (for short, `the VAT Act') whereby the learned Single Judge has allowed the revision negativing the stand put forth in opposition by the State to the stance highlighted by the assessee.

2. The facts on which the controversy rests is in a narrow compass. The respondent manufactures "bitumen emulsion". It filed an application before the Commissioner, Commercial Taxes, Lucknow, U.P. under Section 59 of the VAT Act seeking a clarification about the rate of tax applicable to the sales of bitumen emulsion. The Commissioner of Commercial Taxes, vide order dated 23.1.1999 opined that bitumen emulsion is an unclassified commodity and, therefore, is excisable to tax at the rate of 12.5% as it would fall under the residuary Entry.

3. Being aggrieved by the order dated 23.1.1999, the respondent preferred Appeal No. 6 of 2009 under the VAT Act before the Tribunal Commercial Taxes, U.P., Lucknow (for short `the tribunal') which was heard by the Full Bench. It was contended before the tribunal by the assessee-appellant therein that bitumen as a commodity is taxed at 4% under Serial no. 22 Part A of Schedule II to the VAT Act and bitumen is found in solid state and to bring it in the liquid form, water is added to it and very little quantity is used in the process. Elaborating the said submission, it was urged that when bitumen is available in the liquid form, it is known as bitumen emulsion and is commonly known as bitumen when it is available in the solid form; and both the commodities are understood in the same manner in the commercial world and the end use is the same and, therefore, the rate of tax to be determined has to be the same as prescribed for bitumen.

4. Be it stated, as per Notification No. 100 dated 15.1.2000 issued under the erstwhile U.P. Trade Tax Act, 1948, bitumen was taxed at 20%. Under the VAT Act, bitumen has been classified under Part A of Schedule II and the tax leviable is 4%. Before the tribunal, the assessee-appellant produced reports from Harcourt Butler Technical Institute, Kanpur to bolster the stand that there is no difference between the two commodities and they are to be categorised as one item, if common parlance test is applied. To buttress the submissions, the assessee relied upon CST v. Ashok Grah Udyog Kendra Private Ltd., (2004) UPTC 1827, CST v. Bechu Ram Kishori Lal, (1976) 36 STC 236, and M/s Indodan Milk Products v. Commissioner Sales Tax, (1974) 33 STC 381. The tribunal referred to one of its earlier decisions in appeal no. 17 of 2000 decided on 3.4.2009 and on the basis of reasons ascribed therein dismissed the revision.

5. The dissatisfaction caused by the said adjudication, constrained the assessee to approach the High Court in Commercial Tax Revision no. 1156 of 2009. The High Court formulated the point in issue which reads as follows:-

"Whether the Bitumen and Bitumen Emulsion are one and the same commodity for the purposes of interpretation of Entry No. 22 Schedule II Part A of the U.P. Value Added Tax Act, 2002 as was originaly enacted i.e. upto enforcement of notification no. 2758 dated 29.9.2008?

6. The learned Single Judge took note of the various technical materials from the Government approved laboratory which had been brought before the tribunal, and opined that the controversy had not been appositely appreciated by the tribunal, for the materials clearly establish that bitumen and bitumen emulsion is the same thing. The High Court analysed the concept of end use, i.e. the end result of bitumen emulsion and came to hold that bitumen emulsion makes the bitumen easily usable in its emulsified