M/S Eureka Forbes
Limited Vs. State of Bihar and Ors.
O R D E R
present case relates to assessment of the Appellant herein concerning
assessment years 1990-91, 1991-92, 1992-93 and 1993-94.
assessment proceedings were initiated under the Bihar Finance Act, 1981 read
with Bihar Sales Tax Rules, 1983. Notices under Section 17 (2)(a) of the Act
were issued to the assessee for examination of books of accounts. The said
books of accounts were produced and assessment orders under Section 17 (2)(b)
of the Act were passed. In the said assessment order, the assessee was levied
tax on vacuum cleaner at the rate of 12% treating it as electrical goods as
against the contention of the Appellant that vacuum cleaner, which is an
article dealt with by the Appellant, is taxable at the rate of 8%.
Assessing Officer by the assessment order rejected the aforesaid contention of
the assessee while holding that the assessee is liable to pay tax on vacuum
cleaner at the rate of 12%. Being aggrieved by the aforesaid findings and
assessment order passed by the Assessing Officer, the Appellant filed appeals
which were entertained and disposed of dismissing the said appeals.
aggrieved by the aforesaid order passed in appeals, the assessee preferred
Revision Applications before the Commercial Taxes Tribunal. By an order passed
on 15.4.2004, the Tribunal dismissed the said Revisions holding that the vacuum
cleaner is an electrical good or instrument and, therefore, it falls within
Entry 81 of the Notification dated 26.12.1977 issued under Section 12 of the
Bihar Finance Act - Bihar Sales Tax Act, 1959.
aggrieved by the aforesaid order of the Tribunal, a writ petition was filed,
which was again dismissed by the High Court by judgment and order dated
26.2.2010 as against which this appeal was filed.
have heard the learned counsel appearing for the parties in this appeal, who
have taken us through the records. In the light of their submissions and on
perusal of the records, we propose to dispose of this appeal by recording our
issue that arises for consideration is whether the article vacuum cleaner could
be included within the Entry 81 of the Notification dated 26.12.1977 issued
under Section 12 by the respondents.
81 of the said notification reads as follows:- "81. Electrical goods,
instrument, apparatus and appliances including electric fans and lighting
bulbs, electric earth ware and porcelain and all other accessories excluding
electric motor, dry cell batteries, torch, torch bulbs, exhaust fans, air
circulators, and spare parts and accessories, electric heaters of all
appearing for the Appellant has submitted before us that particular article,
namely, vacuum cleaner, which is the article dealt with by the appellant in the
course of its business cannot be included within the ambit and scope of Entry
81 in view of the fact that the said article is not mentioned specifically
within the aforesaid Entry. In order to reinforce his arguments, Mr. S.B.
Sanyal, learned senior counsel also relied upon the subsequent Notification
which is issued by the respondents on 26.7.2000. He has drawn our attention to
the contents of the said Notification and particularly to serial no. 247 where
vacuum cleaner is specifically mentioned with the rate of sales tax payable @
It is submitted by
him that since in the subsequent Notification in 2000, vacuum cleaner has been
specifically stated under serial no. 247 specifying the rate of sales tax at
12%, it should be assumed that the aforesaid vacuum cleaner having not been
specifically mentioned in the earlier Notification under Entry 81, would be
liable for the purpose of tax at 8% being an unspecified good. We have
considered the said submissions in the light of the records. The Entry 81,
which we have extracted above, provides that electrical goods, instruments,
apparatus and appliances would have to be levied 12% tax effective from 1.4.1982.
However, when it states of electrical goods, the same appears to us to be an
inclusive description as it emphasises on the word `including electrical fans
and lighting bulbs, etc.' and again it excludes from its purview electric motor,
dry cell batteries, etc.
reference to Section 12 of the Act would also make the position clear for
Section 12 says in the proviso that the State Government can issue a
notification fixing higher rate than eight percentum by specifying such goods
or class of goods or description of goods. Therefore, by issuing a notification
under Section 12, a higher rate than of 8% could be levied by the State
Government on a class of articles of goods or goods specifically mentioned
therein. The aforesaid position would be more explicit when we look to the
Entries 116 and 127 of the same Notification of 1977 wherein by the Entry 116,
articles like refrigerators, air- conditioners, air-coolers and
air-conditioning plants, etc. have been taken out from the items electrical
goods under Entry 81 by levying higher rate of tax.
the vacuum cleaner dealt with by the appellant is an electrical good, there is
no dispute raised for in the Special Leave Petition itself it is stated by the
Appellant that the vacuum cleaner is machinery which is run by electricity.
Therefore, it is an agreed and uniform case of the parties that vacuum cleaner
is an electrical good. The said vacuum cleaner is not excluded from the purview
and ambit of Entry 81 in any manner as is apparent from a bare reading of the
contents of Entry 81.
are concerned with the assessment years prior to 2000 and, therefore, the
Notification issued on 26.7.2000 shall have no relevance or application to the
facts of the present case.
appearing for the Appellant has submitted that since vacuum cleaner is not
specifically included within the Entry 81, therefore, it should be deemed to be
excluded. We are unable to accept the aforesaid contention in view of the fact
that none of any electrical goods, instruments, apparatus, which is included in
the said Entry is specifically mentioned and if that interpretation is
accepted, all electrical goods would have to be excluded because they are not
specifically mentioned therein. That could not be the intention of the framers
of the Notification while exercising the powers under the subordinate
legislation. If we also accept such an interpretation, in our opinion, entire
Entry 81 would be rendered otiose.
counsel also relied upon a decision of this Court in The Federation of Andhra
Pradesh Chambers of Commerce & Industry and Ors. Etc. Etc. v. State of
Andhra Pradesh and Ors. Etc. Etc.
reported in (2000) 6 SCC 550, wherein it is laid down in para 7 that taxing
statutes are to be strictly construed and that nothing could be added to what
is stated in the statute itself. We agree and accept the aforesaid principles
of law laid down by this Court. That is a settled position of law, but
according to us, the said decision in no way helps the Appellant in view of the
reasoning given by us for the findings arrived at by us. So far the decision of
the Division Bench of the Patna High Court in Eureka Forbes Ltd. v. State of
Bihar and Ors. reported in 2000 (119) STC 460 (Pat.) is concerned, the same is
also not applicable to the facts of the present case as the same relates to a
case of re- opening of assessment on the ground of change of opinion and
therefore, the said case also has no application at all. The decision of the
Bombay High Court in Indian National Ship owners' Association, a Company having
its registered office through its Deputy Secretary and Mr. Badrinath Durvasula
having his place of business v. Union of India (UOI) through Secretary, Dept.
of Revenue, Ministry of Finance Govt. of India and Ors. reported in 2009 (14)
STR 289 (Bom.) also has no application to the facts of the present case.
have given our reasons for arriving at our findings and in our considered
opinion, the decisions given by the High Court as also by all other authorities
are correct decisions, recording cogent reasons, and, therefore, we are not
inclined to interfere with the same.
appeal has no merits and is dismissed accordingly but leaving the parties to
bear their own costs.
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