The main legal point established in the judgment is that the interpretation of terms in a statute should be based on their popular and commercial sense, with reference to the context in which they occur.

1. The petitioner was assessed to sales tax for the year 1966-67 overruling his plea which relates to the levy of tax at 5% on a turnover of Rs. 63,461.50 representing the first sales of kesophane cellulose films. According to the assessee, kesophane cellulose film does not come under item 42 of the first Schedule in the Kerala General Sales Tax Act, 1963, as it stood at the relevant time. The assessing authorities as well as the Tribunal took the view that kesophane cellulose film is 'paper' falling within Entry 42 of the first Schedule chargeable at 5% at the point of first sale.

2. Item 42 of the first Schedule reads:

"Paper (other than newsprint), card boards, straw board and their products."

The case of the Revenue is that though kesophane cellulose film is not included in the terms "card boards, straw board and their products" it it'paper' within the meaning of the item.

3. Kesopbane cellulose film is only a trade name and it is agreed both by the assessee as well as the department that it is cellophane. The question is whether cellophane is 'paper' to come within item 42 in the first Schedule as it stood then.

4. The word 'paper' is not defined in the Act. A word which is not defined has to be understood according to its popular and commercial sense with reference to the context in which it occurs.

5. We shall now state the principle to be borne in mind in examining the question whether cellophane can be considered as paper for the purpose of assessment under the Kerala General Sales Tax Act.

6. The following is the general meaning of the term'paper' in the Chambers's Twentieth Century Dictionary:

"a material made in thin sheets as an aqueous deposit from linen rags, esparto, wood-pulp, or other form of cellulose, used for writing and printing, wrapping and other purposes: sometimes extended to similar materials not so made, as papyrus, rice-paper, to the substance of which some wasps build their nests, to cardboard, and even to tin-foil:, ('silver paper')."

"Cellophane" according to the Reader's Digest Great Encyclopaedic Dictionary, Volume I, is the "proprietary name for glossy transparent material made of cellulose and used as wrapping etc." In Volume III of the same book "cellophane" is stated to be the "proprietary name for transparent cellulose sheet much used in the wrapping of foodstuffs; prepared by the extrusion of a film of viscose (cellulose xanthate) into an acid bath."

7. The following description of "cellophane" occurring at pages 555 and 557 in the Text Book of Organic Chemistry, 2nd edition by Lloyd N. Ferguson was_ brought to our notice. The learned author says: "Sodium hydroxide solutions of cellulose react with CS2 to form xanthates.

The alkali solution of xanthate is a viscous, colloidal solution called viscose. When viscose is treated with acid, it decomposes to regenerate the cellulose. If this viscose is forced through a spinneret into an acid solution, cellulose fibers are formed. This is sailed rayon and is used for producing a textile offering some advantages over ordinary cotton. Note that its chemical compoistion, however, is still that of cellulose. It merely has different physical properties. When the viscose is extruded on to rollers in an acid medium, films are deposited, called cellophane. Cellophane is used as packing material."

In Webster's Third New International Dictionary cellophane is said to be "a transparent sheet or tube of regenerated cellulose highly impermeable to dry gases, grease, and bacteria made by extruding alkaline viscose solution through a narrow straight or circular die into an acid bath, usu. moisture proofed by thin coatings and sometimes dyed, and used chiefly as wrappers or bags for packaging food and merchandise, window envelopes, or bags for dialysis." It is not necessary to go into a minute analysis of the chemical composition of the cellophane sheet. As is noted already cellophane is only the proprietary name for transparent cellulose sheet. It cannot be de