JUDGMENT
Kanhajya Singh, J.
1. These there references under the Bihar Sales Tax Act have been heard analogously. The assessee in all these cases is Dr. Naresh Chandra Ghose, and the facts are also similar. The assessee carries on business of manufacturing and selling Ayurvedic, medicines under the name and style of “Sadhana Ausadhalaya”. In Miscellaneous Judicial Case No. 388 of 1957, the assessment of sales tax upon the petitioner is for the periods 1952-53 and 1953-54. He was assessed on a total taxable turnover of Rs. 1,92,878 in 1952-53 and of Rs. 1,93,626 in 1953-54.
He claimed a deduction of Rs. 36,180/8/- in the first year and Rs, 39,829 in the second year on account of sale of Mritasanjibani Sura. His claim was founded upon Notification No, STGL-60/51-4280 F.T. dated 2-4-1951, by which, in exercise of the powers conferred by Section 6 of the Bihar Sales Tax Act. 1947 (Bihar Act XIX of 1947), the Governor of Bihar was pleased to direct that the goods mentioned therein will be exempt from payment of sales tax subject to the conditions and exceptions, if any set
out in the corresponding entry in the third column thereof.
One of the goods extempted from sales tax is country liquor, as mentioned in item 10 of the said Notification. The assessee raised an objection before the Sales Tax Officer, before the Assistant Commissioner of Sales Tax, before the Deputy Commissioner of Commercial Taxes under Section 24 of the Bihar Sales Tax Act, 1947 (hereinafter referred to as the Act) and also before the Board of Revenue that there was no liability to pay sales tax on the amount of sale proceeds fetched by sale of Mritasanjibani Sura on the ground that it was a country liquor. This contention was rejected by all these authorities. At the instance of the assessee the Board of Revenue has submitted the following question of Jaw for the opinion of the High Court under Section 25(1) of the Bihar Sales Tax Act (Bihar Act XIX of 1947) in Miscellaneous Judicial Case 388 of 1957:
“Whether having regard to the prescribed ingredients for the preparation of Mritasanjibani Sura, it should be regard as a country liquor exempt from tax under item No. 10 of Notification No. STGL-60/51-4280 F. T. dated 2-4-51.”
2. In his applications to the Board of Revenue
under S. 25 of the Bihar Sales Tax Act, 1947 the
assessee had asked for reference to the High Court
of several questions of law, but only one of them,
as stated above, was referred by the Board. Being aggrieved by and disatisfied with the said order of the Board the assessee filed two applications before this Court under Sections 25(2) and 25(4) of the Act in respect of assessments for two different periods to direct the Board of Revenue to state a case and refer the questions mentioned therein to the High Court for opinion. Those applications are numbered as Miscellaneous Judicial Cases 320 and 321 both of 1957. These applications were allowed, and as directed by the High Court, the Board of Revenue has stated a case upon the following common question of law in both the cases.
“Where on the facts and circumstances of the case Mritsanjibani Sura is exempt from Sales Tax.
3. There is no substantial difference between the aforesaid questions. What, in effect, we are called upon to answer is whether Mritsanjibani Sura is exempt from Sales Tax. On behalf of the assessee Mr. P.R. Das put forward the argument that the Sales Tax authorities were not legally right in including the sale proceeds of Mritsanjibani Sum in the taxable turn-over of the assessee & the assessment of Sales Tax thereon was illegal. In support of his contention he relied upon Notification No. STGL 607 51-4280 F. T. dated 2-4-1951, referred to above, by which the goods mentioned therein were exempted from Sales Tax with effect from 1-4-1951. Item 10 of this notification is relevant for the present purpose and is in the following terms:
“Country liquor including toddy and pachwai but excluding potable foreign liquor and medicated wine; ganja, bhang, excise opium excluding preparations of opium, bhang and charas.”
It is evident that what is exempted from Sales Tax under item 10 is country liquor, including toddy and pachwai, but notable foreign liquor and medicated wine are not exempted from Sales Tax. In other words. Sales Tax may be imposed upon medicated wine under the Bihar Sales Tax Act. The question, therefore, boils down to this; whether Mritsanjivani Sura is a medicated wine? In the opinion of Sales Tax authorities it is a medicated wine and not a country liquor.
On the other hand, Mr. Das strenuously urged that it was not a medicated wine, but a country liquor. There is no dispute that if Mritsanjibani Sura is a country liquor, then certainly it will be exempted from Sales Tax by virtue of the aforesaid notification. The opposing view-points pressed before us were taken before the Deputy Commissioner, Sales Tax also, and in a very good and well-considered judgment dated 15-10-1955, he has given the following reasons for his holding that Mritsanjibani Sura is a medicated wine and not a country liquor;
“At my request the learned advocate for the petitioner was good enough to furnish me with translation of the relevant portion of the book Ayurvedic Sangraha by Principal Cananath Sen page 1211; which deals with the methods of distillation of the Mritasanjibani Sura and its uses which is as follows:
Barks of Arabica, Jujulu & Betelnus each 2 seers, Symlocos, Racemosa (Lodh) 1/2 seer. Ginger root 1/4 seer and water 8 times the total weight of those raw materials. Molasses 12 1/2 seers to be mixed in the water and those raw materials and then to be well mixed together. Then add to it betelnuts and lodh (i. e. Symlocos Racemosa) and then put them into a vessel, cover its mouth with a dish and tie it up well and then leave the vessel in this condition for at least 20 days.
Then pour the contents of that vessel into an earthen or copper distilling vessel. Add to it further quantities of powdered betelnuts Elbaluk, Piousdeodara, cloves, Padma wood, root of fragrant grass, red
sandal wood, Pill-seed, Ajava seeds, Black pepper, India, Sati, Spinkenared, Cinnemon, Cardamom, cypurs roturdus (muta or grass root). Gatela sunt Mouri, Fanugreed (Mithi) each 4 totals. Then the entire contents of the distiling vessel is to oe heated over a controlled low heat and the vapour is to be condensed and distilled into wine (Sura).
The dose is to be decided according to age and constitution of persons.
It increases strength, appetite, vigour and retentivity. It is very invigorating. This wine (Madya) can be judiciously administered in various complaints.
The methods and procedure described above for the preparation of the Mritansajivani Sura and the ingredients used for its preparation leave no scope for doubt that it is a wine with medicinal properties and can as such be said to be a medicated wine. There can be no stronger evidence on this point than the fact that this sura finds place in Ayurvedic Shastra and is sold by a concern dealing in Ayurvedic medicines,
On a careful consideration of the issues involved and the arguments put forth on behalf of the parties I have no doubt left in my mind that Mritasanjibani Sura though a country liquor is a medicated country liquor (wine) and as such is not exempt from tax as plain country liquors are. . A distinction, in my opinion, has to be drawn between medicinal preparations containing alcohol or narcotic drugs and alcohol containing medicinal properties. The fact that Mritasanjibani Sura is not taxed by the Union as a medicinal preparation containing alcohol but on the other hand is taxed at the rate applicable to country liquor by the State does not necessarily show that it is not a medicated wine.”
By its order dated 30th April, 1956, the Board of Revenue affirmed not only the conclusion reached by the Deputy Commissioner of Sales Tax but also the reasons given by him. The ingredients of Mritsanjibani Sura and the method of its preparation, as stated by the Deputy Commissioner, were not questioned by learned Counsel for the petitioner. The contention of Mr. Das is that the different herbs which enter into the composition of Mritasanjibani Sura are not the
correct criteria for judging whether it is a country liquor or a medicated wine.
He laid great stress upon the quantity of molasses used for preparation of Mritasanjibani Sura. According to the Ayurvedic Sangraha by Principal Gannanath Sen, the quantity of molasses used is 12-1/2 seers as against small quantities of different raw materials. His submission is that when molasses from the dominant basis of Mritasanjibani Sura, it is nothing but country liquor. He urged that having regard to these ingredients Mritansanjibani Sura has always been regarded by authorities as country liquor, and therefore, excise duty and not Sales Tax has been imposed on it so far.
He referred to Entry 84 of List 1 and Entry 51 of List 2 of the Seventh Schedule of the Constitution and urged that under these Entries read with Article 246 of the Constitution exclusive power to levy and collect duties of excise on medicinal and toilet preparations containing alcohol has been given to the Parliament and not to the State Legislature and that the State Legislature has exclusive power to impose and realise duties of
excise on alcoholic liquors for human consumption.
He further pointed out that pursuant to this power the State of Bihar has always imposed
excise duty on Mritasanjibani Sura treating it as country liquor. Mr. Das is right in saying that the Union of India has got exclusive power to impose and realise duties on medical preparations containing alcohol. The State of Bihar has also imposed excise duty on Mritansanjibani Sura on the assumption that it is country liquor, but as rightly observed by the Deputy Commissioner of Sales Tax, these considerations do not conclude the matter.
The Parliament may have power to levy excise duty on medicinal preparations containing alcohol, and the State Government may have imposed excise duty on Mritasanjibani treating it as country liquor. These considerations are wholly immaterial. The important question for consideration is whether having regard to the composition of Mritasanjibani Sura and the method of its distillation, it can be classed as a country liquor or a medicated wine. I am in full agreement with the Deputy Commissioner that the ingredients which are used for the preparation of Mritasanjibani Sura show unmistakably that it cannot be treated as ordinary country liquor.
As observed by the Member, Board of Revenue, and not denied by the petitioner, Mritasanjibani Sura is made by distilling a lot of medicinal herbs mixed with certain bases producing alcohol. Another fact of common knowledge, which is also not controverted is that it is u ed for medicinal purpose, according to the prescriptions of Ayurvedic physicians, and not as an ordinary alcoholic beverage. Apart from this, we cannot ignore the hard fact that Mritasanjibani Sura has never been treated as ordinary liquor and sold by ordinary liquor vendors. It is stocked and sold by Ayurvedic Ausadhalayas. If we take the ordinary dictionary meaning of the word ‘medicated,’ it means “impregnate with anything medicinal.”
The herbs that are used for the preparation of Mritasanjibani Sura possess medical properties, even on the authority quoted by the assessee himself before the Deputy Commissioner, and in effect, Mritasanjibani Sura increases strength, appetite, vigour and retentivity. It is invigorating and can be administered in various complaints. There fore, having regard to the essential ingredients of Mritasanjibani Sura, the method of its preparation and the effect it produces, there is no escape from the conclusion that it is a medicated wine and not a country liquor as commonly understood. Accordingly, it is not exempt from Sales Tax.
4. For these reasons I hold that in the circumstances of this case the assessment of Sales Tax upon the assessee for both the periods, namely, 1952-53 and 1953-54 is legally valid. Accordingly, the questions referred to by the Board of Revenue must be answered in favour of the State of Bihar and against the assessee. The opposite party is entitled to costs of the references. There will be a consolidated hearing fee of Rs. 200 in all the three cases.
V. Ramaswami, C.J.
5. I agree.