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1976 Supreme(Mad) 192
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE V RAMASWAMY & THE HONOURABLE MR. JUSTICE V SETHURAMAN
State of Tamil Nadu - Appellant
Versus
Blue Star Engineering Company, Madras Private Limited - Respondent
Case No : T.C. Nos. 310 & 316 of 1971
Decided On : 25 March 1976
Where there are two entries in a tax schedule, one general and the other particular, the particular or specific entry must be used for the purpose of levying the tax.
Headnote:
SALES TAX - Duplicating machines - Electrical equipment used for duplicating purposes - Whether taxable under entry 1 or entry 41 of Schedule I to the Tamil Nadu General ST Act - Held, taxable under entry 1.
Fact of the Case:
The assessee, a company, was assessed to sales tax on the sales of drawing office equipment, which was later found to be duplicating machines. The assessee claimed that the equipment was not a duplicating machine since it could not function except with the application of electricity and that it came within the scope of entry 41 of Schedule I to the Tamil Nadu General ST Act, which covers all kinds of electrical goods. The assessing authority, however, considered that the equipment came under entry 1, which covers typewriters, tabulating machines, calculating machines, duplicating machines, and parts thereof.
Finding of the Court:
The court held that the equipment was a duplicating machine and was therefore taxable under entry 1 of Schedule I to the Tamil Nadu General ST Act. The court found that the equipment was intended for taking copies of blue prints and documents and that it performed and was intended only for duplicating purposes. The court also found that the fact that the equipment was operated by electricity did not bring it within the scope of entry 41, which covers electrical goods, since entry 1 was a specific entry for duplicating machines.
Issues: Whether the drawing office equipment was a duplicating machine and therefore taxable under entry 1 of Schedule I to the Tamil Nadu General ST Act.
Ratio Decidendi: The court held that the equipment was a duplicating machine and was therefore taxable under entry 1 of Schedule I to the Tamil Nadu General ST Act. The court found that the equipment was intended for taking copies of blue prints and documents and that it performed and was intended only for duplicating purposes. The court also found that the fact that the equipment was operated by electricity did not bring it within the scope of entry 41, which covers electrical goods, since entry 1 was a specific entry for duplicating machines.
Final Decision: The court allowed the assessee's tax revision case No. 310 of 1971 and dismissed the assessee's tax revision case No. 316 of 1971.
SETHURAMAN, J.
These two tax revision cases arise out of the sales tax assessments for the asst. yr. 1966-67 and 1967-68. They are on identical acts and, therefore, it is enough to consider the facts on one year apply the conclusion arrived at therein for the other.
2. In making the assessment on the assessee for the asst. yr. 1966-67, the assessing authority taxed the sales of drawing office equipment amounting to Rs. 83, 633-75 at 61/2 percent. Later on, he fond that this equipment had to be treated as duplicating machine and assessed to tax at 11 percent. He, therefore, took action under s. 16. The nature of this equipment had been described in an affidavit filed by the manager of the assessee-company, who is a qualified engineer, which run as follows :-
"The drawing office equipment works on electrical circuit with the voltage of 220-230. Light from the astral on tube the actinic lamp is released to pass through a spring loaded roller mounted with the specimen for" *
which the facsimile is required. The spring loaded roller mechanism rotates the sensitised paper (dipped in a chemical solution) and the specimen around the lamp. A time switch is also provided for controlling the time during which the light is to pass through this specimen. Both the roller mechanism and the time switch are operated by electricity. The rotation of the sensitised paper and the specimen around the light for the required length of time completes the operation and the fasimile of the specimen is obtained on the sensitised paper.
However, the usage of the equipment is subject to certain limitations. For getting clear and correct fasimile of the specimen, the specimen should be typed or printed on a translucent paper for the light from the actinic lamp to pass. The matter should be typed or printed only on one side of the paper and it should be either blue or black. Copies can be had on the sensitised paper which can be utilised only for getting facsimile from the specimen by the above process. Both the chemical solution and the sensitised paper have got a specified file and so have to utilised before the expiry dates mentioned therein. Without electricity or the sensitised paper, the facsimile cannot be obtained"
3. The assessee claimed that this equipment cannot be treated as a duplicating machine since it cannot function except with the application of electricity. It was also stated that the machine was machine was equipped with an electrical roller for the movement of the chemical paper an that, therefore it came within the scope of entry 41 of Schedule I to the Tamil Nadu General ST Act. Entry 41 reads as follows :-
|-----|-----------------------------|-----------------|---------| | Sl. | Description | Point of levy | Rate of | | No. | of goods | | Tax | | | | | percent | |-----|-----------------------------|-----------------|---------| | 41. | All kinds of electrical | At the point of | 9 | | | goods (other than those | first sale in | | | | specified elsewhere in | the State | | | | this schedule), including | | | | | wires holders, plugs, | | | | | switches, casings, capping, | | | | | reapers, bends, junction | | | | | boxes, meter boxes, switch | | | | | boxes meter boards, | | | | | electrical earther-ware | | | | | and porcelain ware. | | | |-----|-----------------------------|-----------------|---------|
The assessing authority, however, considered that this came under entry 1, which runs as follows :
|-----|-----------------------------|-----------------|---------| | 1. | Typewriters, tabulating | At the point of | 15 | | | machines, calculating | first sale in | | | | machines and duplicating | state. | | | | machines and parts | | | | | thereof and ribbon. | | | |-----|-----------------------------|-----------------|---------|
He pointed out that it was not denied that these machines were intended for taking copies of blue prints and documents. Treating them as copying apparatus used as duplicating machines, he held that the turn-
