CASE NO.: Appeal (civil) 1039 of 2000 PETITIONER: THE FEDERATION OF ANDHRA PRADESH CHAMBERS OF COMMERCE & INDUSTRY AND Vs. RESPONDENT: V. DATE OF JUDGMENT: 04/08/2000 BENCH: S.P. Bharucha, Sved Shah Mohammed Quadri, N. SanioshHegde JUDGMENT:
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JUDGMENT
BHARUCHA. J.
Leave granted in S.L.P.(C)No. 2877 of 1998. Abench of
five Judges of the Andhra Pradesh High Court interpreted the word
“used” in The Andhra Pradesh Non-Agricultural Lands Assessment
Act, 1963 (“the said Act”) to mean “non-agricultural lands not
only ‘actually used” but are ‘meant to be.used or ‘set apart for
being used’.” This view is contested in these appeals by some
industries in Andhra Pradesh and, with permission, by their
Federation.
The said Act was enacted to provide for the levy of
assessment on lands used for non-agricultural purposes. Section
2(d) defines ‘industrial puipose’, so far as it is relevant to
these appeals, to mean “any purpose connected with an industrial
undertaking where the process of manufacturing any article .is
earried on with the aid of power……” ‘Non-agricultural land’
is defined by Section 2(g) to mean “land other than the land used
exclusively tor the purpose of agriculture….” Section 3 of the
said Act is the charging section and, so far as it is relevant,
reads thus: “3. Levy of assessment on non–agricultairal
lands:- In the ‘ case of non-agricultural land in a local area
with the population specified in column (1) of the Schedule,
there shall be levied and collected by the Government for each
fasli year commencing on the first day of July, from the owner of
such land, an assessment. at the rate specified in column (2)
where the land is used for any industrial purpose, at the rate
specified against ii m column (3) where the land is used for any
commercial purpose, and at the rate specified against it in
column (4} where the land is used for any other non-agricultural
purpose including residenial purpose.’ The Schedule that is
referred to in SECTion 3 sets out the rates of assessment per
square metre of land used (a) for industrial purposes per fasli
year, (b) for commercial purpose per fasli year and (c) for any
other non-agricultural purpose, including residential purpose,
per fasli year. The question with which we are concerned came up
first before the Andhra Pradesh High Court in the case .of S.
V.Cement Ltd. vs. Revenue
Divisional Officer, Nand\-a) and Ors (1993 (2) ALT 32) a.nd
a bench of three learned Judges held: “In the context it is
susceptible of wider meaning. The word “used” means not only
*’actually used”; but it also means any land meant to be used or
set apart for being used. The definitions of “industrial
purpose” and “commercial purpose” also lend support to the wide
meaning given to the word “used”. “Industrial purpose” means any
purpose connected with industrial undertaking. Likewise,
“commercial purpose” means the purpose connected with the
undertaking in trade, commerce or business. The definitions do
not say that the non-agricultural land should be actually
utilised for an industrial or commercial activity, but it is
enough if the land is kept for use for a purpose connected with
industrial or commercial undertaking.” A bench of two learned
judges of the Andhra Pradesh High Court took the view that the
judgment in S.V. Cement Ltd. required reconsideration.
Accordinglv. the writ petitions in which the question was raised
was placed before the bench of five Seamed Judges. They held
that the word ‘used” had to be interpreted to connote a wider
meaning. If that interpretation was adopted, non-agricultural
lands not only actually used for industrial purposes but those
meant to be so used or set apart for being so used were also
liable to assessment as such under the said Act. It was conended
before hem based on the celebrated judgment in the case of Cape
Brandy Sundicae Vs Inland Revenue Commissioners, (9) 1921- 8 KB
64(71), and a judgmen of this Court, that fiscal legislation had
to be
strictly interpreted, and if two interpretations were
possible, the one favourable to the assessee would prevail. The
learned Judges found that “the contention that the word ‘used’
has to be given the limited meaning ‘actually used’ is not in
time with the intendmeni of the Itegislature,……The
legislature had intended the word ‘used’ to mean to be used or
set apart for being used.” Accordingly, the view taken in the
case of S.V. Cement Ltd. was affirmed. Section 3 of the said
Act speaks of “land is used for any industrial purpose”, “land is
used for any commercial purpose” and “land is used for any other
non- agricultural purpose” The emphasis is on the words ‘is
used’. For the puipos’es oFlevy of assessment on
non-agricultural lands at the rate specified in the Schedule tor
land used for industrial purposes, therefore, there ha.s to be a
finding as a fact that the land is in fact in praesenti in use
for an industrial purpose. The same would apply to a commercial
purpose or any other non- agricultural purpose. 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, 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 intencment. There is no equity
about a tax. There is no “cresumpion 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 Th^ State of Bombay vs.
Automobile and Agriculural Indusries Corporaion, Bombay. (1961
12 S.T.C.122),thisCourtsaid: ”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 clarity its meaning by the use
of appropriate language. the benefit thereof must go to the
taxpayer, it is settled law that in case of doubt, that
inerpreaion of a taxing statute which is beneficial to the
taxpayer must be adopted.” On behalf of the responden – Stae,
learned counsel drew our attention to the judgment of this Cour
in he The Conroller of Estate Duty., (Jujarat vs. Shri Kantilal
Trikamla} {1976 4 SCC 643). That judgment also is to the same
effect and does not avsil the respondents. It said: “The sweep
of the sections which will be presently set out.must., ‘
therefore be informed by die language actually used by the
legislature. Of course, if the- words cannot apply to’anv
recondite species of propery, courts cannot supply new logos or
invent unnatural sense to words ro flufil the unexpressed any
unsatiated wishes of the legislature” ‘ Ws are in no doubt
whatever therefore, the it is only land which is actualy in use
for an indusrial purpose as defined in the said Act ha can be
assessed to non-agriculural assessmen a the rate specified for
land used for industrial purposes. The wider meaning given to he
word used in the
judgment under challenge is untenable. Having regard to
the fact that the said Act is a taxing statute.. no court is
justified in imputing to the legislature an intention that it has
not clearly expressed in the language it has employed. In the
result, the appeals are allowed and the Judgment and order under
challenge is set aside in so iar as it deals with the
interpretation of the word ‘used’ in Section 3 of the said Act.
