AJAY KUMAR TRIPATHI, J.

1. The batch of writ appeals arose out of common order and judgment dated 05.03.2018 passed by the Learned Single Judge who clubbed all the writ applications together, heard the same and allowed the writ applications by the impugned order which is under challenge on behalf of the State.

2. The issue before the Learned Single Judge was whether Rusk/Toast would fall under Entry 7 under the head “Bread” under Schedule I of the Chhattisgarh Value Added Tax Act, 2005 (hereinafter referred to as ‘the VAT Act, 2005’) or whether those items would be required to be dragged into residuary entry under Part IV of Schedule II of the said Act.

3. An effort was made by the Assessing Authorities of the Sales Tax Department to levy and assess tax under the VAT Act, 2005 upon two items namely, Rusk/Toast which were either being produced or marketed by the writ petitioners. The Schedule I of the Act deals with goods which are treated as tax free goods. The rate of taxation, therefore, is zero percent on the items notified in the said Schedule. There is a long list of 63 items which the Taxing Authorities have decided not to levy tax on, Schedule II of the VAT Act, 2005 have 4 parts. The goods notified under different parts are clubbed on the basis of rate of taxation which is leviable upon them. In Part IV of Schedule II there is an entry which reads:- “All other goods not included in schedule I and in part II and part III of this Schedule” which is being referred to as the residuary entry.

4. The arguments on behalf of the writ petitioners who are respondents now, before the Learned Single Judge was that the rusk and toast are also bread and are made-up of the same ingredients and method of manufacture. It is ultimately the moisture content which makes the distinction between bread or toast or rusk. Since the Taxing Authorities have not notified Toast/Rusk as separate items for taxation in any of the schedule or part thereof then the thumb rule of interpretation would be required to be applied. All these items which are akin to bread will have to be read and they did not read under the broad head of ‘Bread’ and no duties will be chargeable on the same. Nothing prevented the Taxing Authorities to sub classify products which have their origin from bakery and tax them separately on the basis of their commercial use or common parlance by which such products are known as. But when no such effort has been made by the State Authorities in the notification issued under the VAT Act, 2005 then such items will have to be interpreted under the broad head of Bread and since bread carries zero percent duty Rusk/Toast cannot be charged by bringing them under the residuary head.

5. An effort was made on behalf of the State, before the Learned Single Judge to urge and argue that the two items should be read into the residuary entry. The assessment or demand so made therefore, based on such an interpretation by Sales Tax Authority should be sustained. The Learned Single Judge while considering such a submission did not agree with such stand of the State, keeping in mind the judicial precedents. He had this to say on this question.

“23. In case of Mauri Yeast India Pvt. Ltd. Vs. State of Uttar Pradesh and Another, (2008) 5 SCC 680 Supreme Court in paragraphs 34, 48 and 56 held as under:

“34. It is now a well settled principle of law that in interpreting different entries, attempts shall be made to find out as to whether the same answers the description of the contents of the basic entry and only in the event it is not possible to do so, recourse to the residuary entry should be taken by way of last resort.

(emphasis supplied)

48. There cannot be any quarrel with the proposition that construction of the word is to be adopted to the fitness of the matter of the statute. But for determining the said question, several factors which would be relevant are required to be gone into. The trade or commercial meaning or the end user context would, t