ORDER
1. The points involved in all the four cases are one and the same and as such they have been heard together and are being disposed of by this common order.
2. The petitioners have filed the present writ applications for quashing Memo No. 6771 dated October 27, 2004, annexed as annexure 3 to C.W.J.C. No. 16128 of 2004 whereby the learned Commissioner of Commercial Taxes has clarified the matter that the tractor is primarily used for agricultural purposes and not for the purposes of carrying passengers or goods and as such in the case of tractor there is liability to pay additional tax and surcharge and is not covered by the notifications dated May 22, 2004 issued under Sections 5(4) and 6(2) of the Bihar Finance Act, (hereinafter referred to as “the Act”) making amendment in the Schedule attached to the Finance (Commercial Taxes) Department Notification S.O. No. 128 dated July 27, 2000, by which light, medium and heavy motor vehicles with four or more wheels have been exempted from payment of additional tax and surcharge. Copies of the said notifications have been annexed as annexures 1 and 2 to C.W.J.C. No. 16128 of 2004.
3. The first submission advanced on behalf of the petitioners is that the Commissioner under the provisions of the Act has no power to issue such direction. Secondly, it has been submitted that the tractor being a light motor vehicle with four wheels is fully covered by entry No. 1 of the notification (annexure 1) and as such is entitled to exemption from payment of additional tax and surcharge. In this connection, our attention was drawn to the specific entries with regard to fixing of rate of tax under Section 12 of the Act wherein entry No. 92 speaks of light, medium and heavy motor vehicles and entry No. 144 speaks of tractor and its accessories, and it was submitted that for the purpose of Section 12 of the Act two classifications have been made whereas tractor has not been excluded from the light motor vehicles while issuing notifications under Sections 5 and 6 of the Act as indicated above. It was also submitted that it is a settled law that Section 6, which deals with additional tax, is self-contained provision in view of non obstante clause and recourse to Section 12 and notifications thereunder cannot be taken for the purpose of construing the entries covered by the two notifications.
4. Learned Counsel appearing for the State, on the other hand submitted that the whole scheme of the Act has to be looked into for the purpose of finding out true import of the entry and as the tractor has always been treated as separate from light motor vehicles for which different entries have been made in the Schedule issued under Sections 11 and 12 of the Act and as such the notifications in question regarding exemption will not include tractor thus entitling to it the benefits of exemption. Alternatively, he submitted that if his first submission is not accepted, then while interpreting the entry it should be seen as to how the word is understood in common parlance and as the tractor is never used for the purpose of carrying goods or passengers, it cannot be treated as motor vehicle for the purpose of exemption of additional tax and surcharge under the Bihar Finance Act.
5. To appreciate the respective submissions, certain provisions and notifications are relevant to be quoted. Section 6 of the Act reads as follows:
6. Charge of additional tax.–Notwithstanding anything contained in Sub-section (3) of Sections 11, 12, 13 and 21 or in any notification issued thereunder every dealer having a gross turnover exceeding the specified quantum as laid down in Section 3 shall, with effect from a date to be specified by the State Government by a notification published in Official Gazette, pay an additional tax at such rate, not exceeding two per cent of his gross turnover (excluding the sale or purchase of goods which have taken place either in the course of inter-State trade or commerce, or outside the State, or in the course of import of goods into, or export of goods out of the territory of India) as the State Government may, from time to time by notification in the Official Gazette, fix:
Provided that State Government may fix different rates within the ceiling rate of 2 per cent on the gross turnover of different goods:
Provided further that in the case of declared goods, as defined in the Central Sales Tax Act, 1956 (Act 74 of 1956)–
(i) where the tax payable under Section 3 or Section 4 equals the maximum amount of tax permissible under Section 15 of the Act, no additional tax shall be payable under this section.
(ii) where the additional tax under this section together with the tax payable under Section 3 or Section 4 would exceed the maximum amount of tax permissible under Section 15 of that Act, the additional tax shall stand reduced to such amount as, together with the tax payable as aforesaid, equals the said maximum amount.
(2) The State Government, may by notification and subject to such conditions and restrictions, as it may impose, exempt from the levy of additional tax gross turnover in respect of any goods or class or description of goods.
6. Section 11 of the Act mentions about point or points in the series of sales at which the sales tax shall be levied.
7. Section 12 of the Act speaks of rate of tax which provides general rate of tax for all taxable turnover. It also empowers the State Government to increase or lower down the rate of tax on taxable turnover by issuance of notifications. The State Government has issued notifications from time to time and has also amended the notifications. For the purpose of present case, notification dated July 27, 2000 issued under Section 12 of the Act with regard to two entries are relevant which are as follows:
(a) S. No. 92 – Light, medium and heavy motor vehicles and
chassis of light medium motor and heavy
motor vehicles–at 12 per cent.
(b) S. No. 144 – Tractor and its accessories–at 4 per cent.
8. Notification issued under Section 5(4) of the Act reads as follows:
S.O. 27, dated the 22nd May, 2004.–In exercise of powers conferred by Sub-section (4) of Section 5 of the Bihar Finance Act, 1981, Part I (Act 5 of 1981), the Governor of Bihar is pleased to exempt sale of light, medium and heavy motor vehicles with four or more wheels from payment of surcharge.
2. This notification shall come into force from the date of its issue.
9. Notification issued under Section 6(2) of the Act reads as follows:
S.O. 25, dated the 22nd May, 2004.–In exercise of powers conferred by Sub-section (2) of Section 6 of the Bihar Finance Act, 1981, Part I (Act 5 of 1981), the Governor of Bihar is pleased to make the following amendments in the Schedule attached to Governor of Bihar, Finance (Commercial Taxes) Department Notification No. S.O. 128 dated 27th July 2000.
AMENDMENT
1. In the said Schedule after serial No. 3 and serial No. 4 and corresponding entries in column 2 and 3 shall be added as follows:
___________________________________________________________________
Serial Description of goods Conditions under which
No. exemption is being granted
___________________________________________________________________
1 2 3
___________________________________________________________________
1. Light, medium and heavy motor Nil
vehicles with four or more
wheels.
___________________________________________________________________
2. This notification shall come into force from the date of its issue.
10. As we are discussing with the taxing statute, law is very clear that it has to be construed strictly and nothing is to be added or subtracted. There is nothing like intendment of Legislature and once there is ambiguity, view should be taken in favour of the subject. In this con nection, I am tempted to refer to the judgment of the Supreme Court in the case of Federation of Andhra Pradesh Chambers of Commerce and Industry v. State of Andhra Pradesh , wherein in para 7 it has been held as follows:
7. It is trite law that a taxing statute has to be strictly construed and nothing can be read into it. In the classic passage from Cape Brandy Syndicate [1921] 1 KB 64 which was noticed in the judgment under appeal, it was said:
In a taxing Act one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing is to be implied. ‘One can look fairly at the language used.
This view has been reiterated by this Court time and again. Thus, in State of Bombay v. Automobile and Agricultural Industries Corporation, Bombay [1961] 12 STC 122, this Court said:
But the courts in interpreting a taxing statute will not be justified in adding words thereto so as to make out some presumed object of the Legislature…. If the Legislature has failed to clarify its meaning by the use of appropriate language, the benefit thereof must go to the tax-payer. It is settled law that in case of doubt, that interpretation of a taxing statute which is beneficial to the tax-payer must be adopted.
11. The apex Court in the said case has held that if the Legislature has failed to clarify the meaning of the word, any benefit thereof must go to the tax-payer. In other words, in case of doubt, taxing statute should be interpreted which is beneficial to the taxpayer. However, in case of exemption it is for the assessee to prove that this case comes within the exemption granted.
12. Section 6 of the Act, which deals with additional tax, is a self-contained provision. The Supreme Court in the case of Kumar Distributors (P) Ltd. v. State of Bihar , held as follows:
From a careful reading of Section 6, it would be crystal clear that so far as charge of additional tax is concerned, this section is self-contained not only for charging additional tax but also for its exemption. Therefore, the exemption notifications specifically issued under Section 7(3) will not cover charge of additional tax to enable the appellants to claim exemption from payment of additional tax. Even though the position is so clear, the learned Counsel for the appellants argued that in the light of Section 21, the turnover will be nil and, therefore, there is no scope for charging additional tax. This argument is based on a misconstruction of Section 6 of the Act. We have pointed out that Section 6 is self-contained and there is an inbuilt provision for exemption from levy of ‘additional tax’ therein, in addition to Section 7(3) which provides for exemption from levy of ‘sales tax’ and ‘purchase tax’. The non obstante clause in Section 6 also overrides Section 7(3) and Section 21 expressly. The position is, therefore, clear in this Act.
13. Thus, Section 6 governs not only charging of additional tax but also covers the case of exemption.
14. Section 6 as quoted above contains non obstante clause excluding the application of provisions of Sections 11 and 12 also and in that view of the matter, any entry or Schedule with regard to Sections 11 and 12 prescribing rate of tax on different articles cannot be resorted to for the purpose of interpreting the two notifications in question. We have to interpret the notifications in question as they are and to find out as to whether the tractor is also included within the exemption clause or not. There is nothing in the Act to show that the definitions given in other Acts are to be adopted in case of absence of any such provisions in the Act and in view of the settled law we cannot read the definition as given in other Acts for the purpose of interpreting the provisions of this Act. Firstly, the entry as a whole has to be read and to be seen as to whether it includes tractor or not and in case of any confusion or ambiguity, as held by the Supreme Court in the case of Ramavatar Budhaiprasad v. Assistant Sales Tax Officer, Akola reported in [1961] 12 STC 286, the word has to be understood in common parlance. In other words, it is to be construed as understood by user. It has been held by the Supreme Court as follows:
…this word must be construed not in any technical sense nor from the botanical point of view but as understood in common parlance. It has not been defined in the Act and being a word of every day use it must be construed in its popular sense meaning ‘that sense which people conversant with the subject-matter with which the statute is dealing would attribute to it. It is to be construed as understood in common language.
15. Now coming to the entry in question, exemption is granted with regard to light, medium and heavy motor vehicles with four or more wheels. Tractor is also having four wheels and it is also commonly known as light motor vehicle, whether it is used for agricultural purposes or non-agricultural purposes is immaterial and as such entry includes tractor and there is no confusion or ambiguity justifying taking recourse to the use of tractor in common parlance as argued by the learned Counsel for the State, who relied upon the aforesaid judgment of the Supreme Court as well as the judgment of the Punjab High Court in the case of Bharat Motor Company v. Assessing Authority reported in [1968] 22 STC 133, wherein his Lordship relying upon the aforesaid judgment of the Supreme Court and Madras High Court has held that the meaning of tractor is to be construed in its popular sense. Even if two views are possible, whether the tractor to be included or not in the entry, in view of the broader meaning of light motor vehicle with four or more wheels which the tractor has, the benefit will go to the tax-payer. Accordingly, we hold that these two notifications apply in case of tractor also.
16. Before parting with this order, we may also deal with the submission advanced on behalf of the petitioners that annexure 3 is a direction by the Commissioner of Commercial Taxes to the authorities to levy additional tax and surcharge on the tractor whereas there is no such provision under the Act empowering the Commissioner to issue such direction.
17. We do not agree with the submission for the simple reason that the Commissioner has not issued any direction but has issued a clarification with regard to certain queries made by the subordinate officers with regard to the application of the entry on the tractor but on that ground the order, as contained in annexure 3, is not to be quashed, but as we have taken a view that the tractor is also included within the entry as mentioned in the notification, the clarification made by the Commissioner of Commercial Taxes is incorrect and accordingly the same is quashed,
18. In the result, all the four writ applications are allowed.