STATE OF MADRAS Vs. HARSHKANT S MEHTA

JUDGEMENT

(1.) THE assessee in these cases is a dealer in industrial diamonds. Taking the view that industrial diamonds would fall under item 30 of schedule I of the Madras General Sales Tax Act, 1959 (hereinafter called the act), the assessing authority determined the taxable turnover of the assessee for the year 1960-61 at Rs. 6, 000 and for the year 1962-63 at Rs. 5, 600 and brought the said turnovers to tax at 3 per cent. single point. THE assessing authority also levied a penalty of Rs. 270 for the year 1960-61 and Rs. 252 for the year 1962-63 under section 12 (3) of the Act on the ground that the assessee had not submitted his turnover for the years in question.

(2.) THE assessee went in appeal, and the appellate authority affirmed the assessment on the turnovers in question for the two years but reduced the penalty from Rs. 270 to Rs. 135 for the assessment year 1960-61 and from Rs. 252 to Rs. 126 for the assessment year 1962-63. THEre were further appeals to the Tribunal, and the Tribunal had taken the view that industrial diamond will not fall within item 30 of Schedule I to the Act and that it will be assessable only at multi-point at the rate of 2 per cent. under section 3 (1)of the Act. In that view it set aside the assessments as the turnovers in dispute were below the taxable limit of Rs. 10, 000. Consequently, the Tribunal also set aside the orders of the authorities below levying penalty. In these tax cases the State contends that industrial diamonds would fall within item 30 of Schedule I to the Act and that the view taken by the Tribunal is erroneous. Item 30 of Schedule I to the Act runs as follows : "precious stones, namely, diamonds, At the point 3 per emeralds, rubies, real pearls and of first sale cent. " * sapphires, whether they are sold in the State. loose or as forming part of any article in which they are set. It is clear from the item set out above that diamonds, emeralds, sapphires, rubies, real pearls, etc. , are only descriptive of the article referred to earlier, namely, "precious stone". THErefore, it cannot be said that diamonds of all types whatever will be taken in by that item. It is only those diamonds which will come under the definition of "precious stones" which will be covered by that item. So it is necessary to find out the scope of the words "precious stones". " Precious stone" is defined in various English dictionaries as hereunder : (1) THE Shorter Oxford English Dictionary : "a gem". (2) Webster's Dictionary : "a rare and costly gem". (3)Chambers's Dictionary : "a stone of value and beauty for ornamentation; a gem or jewel". (4) "reader's Digest Encyclopaedia Dictionary :" gem".