Case Note & Summary
The dispute concerned sales tax assessment of dhoop and aggarbatti under the Punjab General Sales Tax Act, 1948 for the assessment year 1973-74. The appellant, a registered dealer, challenged the levy of sales tax at 10 paisa in a rupee on dhoop and aggarbatti under Entry No.16 of Schedule A, which at the relevant time read 'Cosmetics, perfumery and toilet goods, excluding tooth-paste, tooth-powder, kum-kum and soap'. The assessing authority treated dhoop and aggarbatti as covered by the word 'perfumery' in that entry. The appellant filed a writ petition before the Punjab and Haryana High Court. A learned Single Judge allowed the writ petition, holding that the context of Entry No.16 limited 'perfumery' to articles used for personal hygiene or pleasure, excluding dhoop and aggarbatti. On appeal, a Division Bench reversed the Single Judge, principally relying on the Supreme Court decision in Commissioner of Sales Tax, U.P. v. India Herbs Research and Supply Co., which had held that dhoop and dhoopbatti fell within the ordinary meaning of 'perfumes' in an entry that read 'Scents and perfumes'. The appellant then approached the Supreme Court by special leave, contending that the word 'perfumery' in Entry No.16 had to be construed in the context of the accompanying words 'cosmetics' and 'toilet goods', and relying on the Bombay High Court decision in Commissioner of Sales Tax, Maharashtra State, Bombay v. Gordhandas Tokersey and the Punjab and Haryana High Court decision in Assessing Authority v. Amir Chand Om Parkash. The Supreme Court applied the principle of noscitur a sociis, holding that when articles are grouped together in a taxing entry, each word draws colour from the other words. Since 'perfumery' was grouped with 'cosmetics' and 'toilet goods', it meant only such articles of perfumery as are used on the person for personal hygiene or pleasure. Dhoop and aggarbatti, being used primarily for religious ceremonies, did not fall within that meaning. The Court distinguished the India Herbs Research and Supply Co. case on the ground that in that case the entry 'Scents and perfumes' stood alone and was not limited by surrounding words. The Court also noted that the subsequent insertion of Entry 16A in 1979 specifically including dhoop and aggarbatti could not retrospectively affect the interpretation of Entry 16 for the earlier period. Accordingly, the Supreme Court allowed the appeal, set aside the Division Bench judgment, and restored the Single Judge's order allowing the writ petition. No order as to costs was passed. The connected appeals were allowed and the judgments under appeal were set aside.
Headnote
A) Sales Tax - Interpretation of Taxing Entries - Noscitur a Sociis - Punjab General Sales Tax Act, 1948, Entry No.16 of Schedule A - The word 'perfumery' in Entry No.16 drew colour from associated words 'cosmetics' and 'toilet goods', restricting its meaning to articles of perfumery used on the person for personal hygiene or pleasure. Dhoop and aggarbatti, being used primarily for religious ceremonies, did not fall within the entry. Held that the contextual reading excluded dhoop and aggarbatti from the scope of perfumery, and the Division Bench erred in applying a broader meaning (Paras 1-4). B) Sales Tax - Precedents - Distinguishing Commissioner of Sales Tax, U.P. v. India Herbs Research and Supply Co. - Punjab General Sales Tax Act, 1948, Entry No.16 - In India Herbs, the entry 'Scents and perfumes' stood alone, not limited by surrounding words, and therefore no reason to restrict its meaning; but in Entry No.16, 'perfumery' was grouped with cosmetics and toilet goods, so noscitur a sociis applied. Held that the decision in India Herbs was distinguishable and did not govern the present entry (Paras 1-4). C) Sales Tax - Subsequent Amendment - Relevance of Entry 16A - Punjab General Sales Tax Act, 1948, Entries 16 and 16A - The subsequent notification of 1979 splitting Entry 16 and adding Entry 16A specifically including dhoop and aggarbatti could not be used to retrospectively construe Entry 16 for the period 1973-74. The Division Bench's reliance on Entry 16A to distinguish binding precedent was erroneous. Held that the second ground in Assessing Authority v. Amir Chand Om Parkash, based on context, remained binding (Paras 1-4).
Issue of Consideration
Whether 'dhoop' and 'aggarbatti' fell within the expression 'perfumery' in Entry No.16 of Schedule A to the Punjab General Sales Tax Act, 1948, for assessment year 1973-74, and whether the Division Bench erred in reversing the Single Judge.
Final Decision
The appeal is allowed. The judgment under appeal is set aside and the judgment of the learned Single Judge allowing the appellant's writ petition is restored. No order as to costs. Connected Civil Appeal Nos. 1176/92, 1177/92, 1178/92, 1179/92 are also allowed and the judgments under appeal set aside.
Law Points
- noscitur a sociis
- contextual interpretation of taxing entries
- 'perfumery' in Entry No.16 draws colour from 'cosmetics' and 'toilet goods'
- dhoop and aggarbatti used for religious ceremonies not personal hygiene
- subsequent Entry 16A not retrospective
- decisions on standalone entries distinguishable
