PETITIONER: SARU SMELTING (P) LTD. Vs. RESPONDENT: COMMISSIONER OF SALES TAX, LUCKNOW DATE OF JUDGMENT13/05/1993 BENCH: YOGESHWAR DAYAL (J) BENCH: YOGESHWAR DAYAL (J) KULDIP SINGH (J) CITATION: 1993 SCR (3) 719 1993 SCC Supl. (3) 97 JT 1993 (3) 416 1993 SCALE (2)884 ACT: U. P. Sales Tax Act, 1948-Section 3A (2) Second Proviso- Notification under-Whether phosphorous bronze exigible to a lower rate of tax-Held, 'only' specified metals or their alloys being exigible at the lower rate, it cannot fall within the entry if even very small quantity of it contains and unspecified metal, in this case phosphorous. HEADNOTE: By Notification No. ST-11-333/X-1012-1971 dated 15 November 1971, entry 2(a) copper, tin, nickel, zinc or any other alloy containing any of these metals only were made exigible at a reduced rate of sales tax of I The Judge (Revisions) Sales Tax, U.P., Lucknow held that phosphorous bronze falls within this notification. The Single Judge of the Allahabad High Court took a contrary view and held that it was taxable as an unclassified commodity at 3.5%. Before this court it was contended that phosphorous bronze is made of tin and copper only; that a small quantity of phosphorous is used to deoxidize the metal and that it is not an essential substance of the phosphorous bronze. It was, however, admitted that without the use of phosphorous, phosphorous bronze cannot he produced, and a certain quantity remains in the phosphorous bronze. Dismissing the appeal, this Court, HELD: (1) The emphasis in the entry is that it must contain, even if an alloy, "only" copper, tin, nickel or zinc. The expression "only" is very material for understanding the meaning of the entry. Since the alloy in dispute contains phosphorous, may he in a very small quantity, it cannot fall within entry 2(a) of the notification. (721 -G) Commissioner of Sales Tax v. Hindustan Metal Works (1964) 15 STC 97 720 referred to. JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 266 (NT) of
1980.
From the Judgment and Order dt 14.12.1979 of the Allahabad
High Court in Sales Tax Rev. No. 214 of 1979.
Harish N. Salve, P.P. Singh and Ms. Meenakshi Grover for the
Appellant.
R.C. Verma and Ms S. Mukherjee for R.B. Misra for the
Respondent.
The Judgment of the Court was delivered by
YOGESHWAR DAYAL, J. This appeal is directed against the
judgment of the Single Judge of the Allahabad High Court
passed in Sales Tax Revision No. 214 of 1979 dated 14th
December, 1979. By the impugned judgment the High Court set
aside the order of the Judge (Revisions), Sales Tax, U.P.
Lucknow holding that the Phosphorous Bronze which the
assessee/appellant herein have been manufacturing, fell
within the ambit of Notification No. ST-II-333/X- 10121971
dated the 15th November, 1971 issued in exercise of the
powers under the second proviso to sub-section (2) of
section 3-A of the U.P. Sales Tax Act, 1948 (U.P. Act No.XV
of 1948), and took the view that the relevant entry at
serial No. 2(a) of the said Notification did not cover the
goods prepared by the appellant herein and was thus liable
to be taxed as an unclassified commodity at the rate of
3.5%.The relevant entry reads as under:-
————————————————————
SI. No. Description of goods Rate of tax
————————————————————
1..... ........ ...... .....
2....(a) Copper, tin, nickel or zinc 1 per cent.m
or any other alloy containing any of
these metals only.
(b)......... ....... ......
The contention on behalf of the appellant is that
Phosphorous Bronze manufactured and marketed by them is
covered under the aforesaid entry. According to the
appellant the said Phosphorous Bronze is made of tin and
copper only. It is further contended on behalf of the
appellant that the small quantity of Phosphorous is used to
deoxidise the metal and as such the Phosphorous is not an
721
essential substance of Phosphorous Bronze. It is, however,
admitted case of the parties that without the use of
Phosphorous the Phosphorous Bronze cannot be produced and
certain quantity of Phosphorous still remains in the
Phosphorous Bronze.
The contention of the respondent is that Phosphorous Bronze
is an alloy containing not only the metals mentioned in the
aforesaid entry but Phosphorous also and as such it is not
covered under the aforesaid entry. The words “other alloy
containing any of these metals only” mean that the alloy
made of these metals i.e. copper, tin, nickel or zinc only
and that alone is covered under the said entry. It was
submitted that if any other metal or substance is included
in such an alloy, the same would not be covered under the
aforesaid entry.
A similar question arose in the case of Commissioner of
Sales Tax, U. P. v. Hindustan Metal Works, Hathras reported
in (1964) 15 Sales Tax Cases 97 wherein it was held as
under:-
“The Notification exempts tax on sale of
alloys prepared from the solution of two or
more of the metals enumerated therein. On
account of the word “only” the sale of an
alloy prepared from the solution of two or
more of those metals and some other substance
or substances would not be exempt from tax.
The assesse sold an alloy called phosphorous
bronze which was prepared from the solution of
copper, tin, phosphorous and lead.
Phosphorous and lead are not mentioned in the
notification. They are deliberately added by
the assessee as per agreement between the
parties. The sale is, therefore, prime facie
liable to be taxed.”
We were referred to various dictionary meanings of the words
Phosphorous Bronze ‘which have been noticed by the learned
Judge dealing with case in the High Court. We are really
concerned with the interpretation of the entry. The
emphasis in the entry is-either it should be pure copper,
tin, nickel or zinc and if it is an alloy containing two or
more metals, it must be an alloy containing these metals
only. The expression “only” is very material for
understanding the meaning of the entry. Since the alloy in
dispute contains Phosphorous, may be in a very small
quantity, it cannot fall within entry 2(a) of the aforesaid
Notification. The appeal consequently fails and is
dismissed with costs.
U.R.
Appeal dismissed.
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