Smelting (P) Ltd. Vs. Commissioner of Sales Tax, Lucknow  INSC 288 (13 May 1993)
Dayal (J) Yogeshwar Dayal (J) Kuldip Singh (J)
1993 SCR (3) 719 1993 SCC Supl. (3) 97 JT 1993 (3) 416 1993 SCALE (2)884
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.
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%.
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.
the appeal, this Court,
(1) The emphasis in the entry is that it must contain, even if an alloy,
"only" copper, tin, nickel or zinc.
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
APPELLATE JURISDICTION: Civil Appeal No. 266 (NT) of 1980.
the Judgment and Order dt 14.12.1979 of the Allahabad High Court in Sales Tax Rev. No. 214 of 1979.
N. Salve, P.P. Singh and Ms. Meenakshi Grover for the Appellant.
and Ms S. Mukherjee for R.B. Misra for the Respondent.
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..... ........
Copper, tin, nickel or zinc 1 per cent.m or any other alloy containing any of
these metals only.
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
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
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.
sold an alloy called phosphorous bronze which was prepared from the solution of
copper, tin, phosphorous and lead.
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.