Full Judgment Text
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PETITIONER:
D.H. BROTHERS PVT. LTD.
Vs.
RESPONDENT:
COMMISSIONER OF SALES TAX, U.P. LUCKNOW
DATE OF JUDGMENT08/08/1991
BENCH:
KULDIP SINGH (J)
BENCH:
KULDIP SINGH (J)
RAMASWAMY, K.
CITATION:
1991 AIR 1992 1991 SCR (3) 423
1991 SCC Supl. (2) 71 JT 1991 (3) 378
1991 SCALE (2)270
ACT:
U.P. Sales Tax Act, 1948: Section 4--Exemption from
tax--Notification dated 14.11.1980--Amending the list of
agricultural implements--Sugarcane crusher (Kohlu)--Whether
"agricultural implement" and hence exempt from levy of sales
tax.
Administrative Law: Legislative intention--Taxing
statute--Various items mentioned in one group to be consid-
ered in a generic sense--Courts to give the meaning as
intended by the framers in the statute.
HEADNOTE:
The appellant, a registered dealer under U.P. Sales Tax
Act, 1948 has been selling machinery including sugarcane
crusher. The State Government was issuing Notifications from
time to time exempting agricultural implements from the levy
of sales tax. The State Government by its Notification dated
14.11.1980 amended the list and enumerated agricultural
implements. Since sugarcane crusher (Kohlu) was not included
therein, the appellant claimed before the Sales tax Commis-
sioner that the Kohlu meant for extracting juice from sugar-
cane was an agricultural implement and as such was exempt
from levy of sales tax. Since the Commissioner negatived his
claim, the appellant preferred an appeal before the Sales
Tax Tribunal.
The Tribunal having upheld the findings of the Commis-
sioner, the appellant filed a revision petition before the
High Court. Relying on its earlier decision, the High Court
dismissed the revision petition. Aggrieved by the High
Court’s decision, the appellant has preferred the present
appeal.
Dismissing the appeal, this Court,
HELD: 1. The agricultural process comes to an end when
the crop is harvested and is brought home for marketing or
for further processing. Preparation of gur from Sugarcane is
not the continuation of the agricultural process. [427D-E]
424
Bharat Engineering and Foundry Works v. The U.P. Govern-
ment, [1963] 14 S.T.C. 262 and Commissioner of Income-tax,
West Bengal, Calcutta v. Raja Benoy Kumar Sahas Roy, [1957]
32 I.T.R. 466, relied on.
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2. While giving meaning to an item in a taxing statue
the Courts should give it a meaning as intended by the
framers of the statute by looking at the various items
mentioned in a particular group. The items in one group
should be considered in a generic sense. [427F]
3. In the instant case the notification dated November
14, 1980 includes various items under the head "agricultural
implements". The said definition cannot be confined to the
various implements specifically mentioned therein. The
definition being inclusive it has a wider import and any
other implement which answers the description of an agricul-
tural implement can be included in the definition. A bare
reading of the notification shows that all the implements
mentioned by the name after the word "including....... "are
by and large those which are used for cultivation of land
and other operations which foster the growth and preserve
the agricultural produce. None of these implements can be
worked after the agricultural process in respect of a crop
comes to an end. Therefore the intention of the framers of
the notification could only be to limit the general words in
the notification to the implements of the same kind as are
specified therein. As such sugarcane crushers do not come
within the definition of agricultural implements. [427F-H;
428A-B]
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5047
(NT) of 1985.
From the Judgment and Order dated 17.7. 1985 of the
Allahabad High Court in Sales Tax Revision No. of 1985.
Madan Lokur for the Appellant.
Ashok K. Srivastava for the Respondent.
The Judgment of the Court was delivered by
KULDIP SINGH, J- The short question for our considera-
tion in this appeal is whether a sugarcane crusher (kohlu)
is an "agricultural
425
implement" Within the meaning Of U.P. Government notifica-
tion dated November 14, 1980 and as such is exempt from levy
of Sales Tax.
M/s. D.H. Brothers Pvt. Ltd., a registered dealer under
the U.P. Sales Tax Act, is engaged in the sale of machinery
including sugarcane crushers. After coming into force of the
Uttar Pradesh Sales Tax Act, 1948 (hereinafter called ’the
Act’) the State Government issued a notification dated June
7, 1948 exempting agricultural implements from the levy of
sales tax. Thereafter fresh notifications were issued from
the time to time. The relevant notification dated November
14,1980 enumerated the "Agricultural implements" as under:
"Agricultural implements" worked by
human or animal power, including Khurpi,
Dibbler, Spade, Hansla (Sickle) Garden Knife,
Axe, Gandasa, Chaff Cutters, Shears, Seca-
teurs, Rake, Shovel, Ploughs, Water lifting
leather buckets (Pur and Mhot), Rahat and
persian whell, Chain Pump, Harrows, Hoes,
Cultivators, Seed Drills, Threshers, Shellers,
Winnowing fans, Paddy weeders, Gardenfork,
Lopper), Belcha, Bill Hook (Double edge),
Kudali,Fork, garden Hatchet, Bill Hook (Single
edge), Hay Bailer, Bund formers, Scrappers,
Levellers or Levelling Karahas, Yokes, crop
yield Judginghoops, Hand sprayers Hand dust-
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ers, Animal driven vehicles including carts
having pneumatic tyre wheels, crow bars,
sugarcane Planters and accessories, attach-
ments and spare parts of these agricultural
implements".
The assessee invoked the jurisdiction of Commissioner,
Sales Tax, Uttar Pradesh under Section 35 of the Act claim-
ing that the Kohlu meant for extracting juice from sugarcane
was an agricultural implement within the above quoted noti-
fication and as such was exempt from levy of Sales Tax. The
Commissioner by his order dated December 31, 1983 decided
the question against the assessee. The assessee filed appeal
against the said order before the Sales Tax Tribunal. Luc-
know Bench, under Section 10 of the Act. The Tribunal upheld
the findings of the Commissioner and dismissed the appeal.
Thereafter the assessee preferred a revision petition under
Section 11 of the Act before the Allahabad. High Court. The
High Court relying on its earlier decision in Bharat Engi-
neering and Foundry Works v.
426
The U.P. Government, [1963] 14 S.T.C. 262 dismissed the
revision petition. In that case the question for considera-
tion before the High Court was "whether cane crushers are
agricultural implements within the meaning of the words
’agricultural implements’ as mentioned in the Government
Notification....... and hence exempt from U.P. sales tax."
The question was answered in the negative on the following
reasoning:
"Cane crushers and boiling pans are used only
in the manufacture of gur from sugarcane.
Sugarcane is an agricultural produce and the
process which results in the production of
sugarcane is undoubtedly agriculture, but the
production of gur from sugarcane is a manufac-
turing process and not an agricultural proc-
ess. The agricultural process comes to an end
with the production of sugarcane and when gur
is subsequently being prepared it is manufac-
turing process that commences. Merely because
sugarcane is an agricultural produce anything
that is done to it after it is product is not
necessarily a continuation of the agricultural
process. It cannot be doubted that agricultur-
al produce can the subjected to a manufactur-
ing process; merely because gut is produced
out of sugarcane which is an agricultural
produce, the process of preparing gut does not
become an agricultural process.......... An
agricultural implement is an implement that is
used in agriculture; any implement that is
used after the agricultural process comes to
an end and a manufacturing process commences,
is not an agricultural implement."
The High Court in Bharat Engineering case
relied upon the following observations of this
Court in Commissioner of Income-tax, West
Bengal, Calcutta v. Raja Benoy Kumar Sahas
Roy, [1957] 32 I.T.R. 466:
"Agriculture is the basic idea underlying the
expressions ’agricultural purposes’ and
’agricultural operations’ and it is pertinent
therefore to enquire what is the connotation
of the term ’agriculture’. As we have noted
above, the primary sense in which the term
agriculture is understood is agar-field and
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cultracultivation, i.e., the cultivation of
the field, and if the term is understood only
in that sense agriculture would be restricted
only to cultivation of the
427
land in the strict sense of the term meaning
thereby, tilling of the land, sowing of the
seeds, planting and similar operations on the
land. They would be the basic operations and
would require the expenditure of human skill
and labour upon the land itself. There are
however other operations which have got to be
resorted to by the agriculturist and which are
absolutely necessary for the purpose of effec-
tively raising the produce from the land. They
are operations to be performed after the
produce sprouts from the land, e.g., weeding,
digging the soil around the growth, removal of
undesirable undergrowths and all operations
which foster the growth and preserve the same
not only from insects and pests but also from
depradation from outside, tending, pruning,
cutting, harvesting, and rendering the produce
fit for the market. The latter would all be
agricultural operations when taken in conjunc-
tion with the basic operations above de-
scribed, and it would be futile to urge that
they are not agricultural operations at
all........."
It is clear from the above quoted observations of this
Court that the agricultural process comes to an end when the
crop is harvested and is brought home for marketing or for
further processing. In the present case the agricultural
process finishes when sugarcane is harvested. Preparation of
gur from sugarcane is not the continuation of the agricul-
tural process.
While giving meaning to an item in a taxing statute the
Courts should give it a meaning as intended by the framers
of the statute by looking at the various items mentioned in
a particular group. The items in one group should be consid-
ered in a genderic sense. The notification dated November
14, 1980 includes various items under the head "agricultural
implements". It is no doubt correct that the said definition
cannot be confined to the various implements specifically
mentioned therein. The definition being inclusive it has a
wider import and any other implement which answers the
description of an agricultural implement can be included in
the definition. A bare reading of the notification, however,
shows that all the implements mentioned by name after the
word "including........ "are by and large those which are
used for cultivation of land and other operations which
foster the growth and preserve the agricultural produce.
None of these implements can be worked after the agricultur-
al process in respect of a crop comes to an end. Therefore
the intention of the framers of the
428
notification could only be to limit the general words in the
notification to the implements of the same kind as are
specified therein. We are, therefore, of the view that on
the plain reading of the notification the sugarcane crushers
do not come within the definition of agricultural imple-
ments.
It has been brought to our notice that from 1985 onwards
the State Government has specifically exempted sugarcane
crushers from the levy of sales tax.
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We dismiss the appeal with no order as to costs.
G.N. Appeal dis-
missed.
429