COMMISSIONER OF SALES TAX Vs. TEJCO INDUSTRIES

JUDGEMENT

(1.) This is a reference under section 61(1) of the Bombay Sales Tax Act, 1959 (hereinafter referred to as "the said Act") made at the instance of the Commissioner of Sales Tax. The facts giving rise to this reference are as follows :

(2.) By their application dated 5th May, 1966 made to the applicant, the Commissioner of Sales Tax, the respondents, requested the Commissioner to determine in exercise of the powers vested in him under section 52(1)(e) of the said Act the rate of tax payable in respect of sales of certain magnifying glasses made by the respondents evidenced by their Bill No. 118 dated 28th March 1966. The statements made in this application show that the respondents carried on the business of manufacturing optical appliances and brass parts. Magnifying glasses have been referred to in this application as "optical appliances" these being the words used in the brackets after the expression "magnifying glasses." It was submitted by the respondents that these magnifying glasses were covered by entry 22 of Schedule E to the said Act and were liable to tax at the rate specified therein. After the receipt of this application it appears that the Commissioner issued a show cause notice calling upon the respondents to show cause as to why the said magnifying glasses should not be treated as articles made of glass and as such held to be covered by entry 44 of Schedule C to the said Act. At the hearing before the Commissioner of Sales Tax, the respondents contended that the said magnifying glasses were not covered by entry 44 of Schedule C, as the bulk of the cost of manufacturing a magnifying glass was incurred in making the handle and frame and pointed out that the magnifying glasses sold by them were lenses fitted with chromeoplated handle and frame and that the value of the lenses in the said magnifying glasses was much less than the cost of the handle and the frame, as the glass part of the said magnifying glasses cost even less than half of the costs of the chromeoplated handles and frames. It was also contended by the respondents that the said magnifying glasses could not be covered by entry 44 of Schedule C to the said Act as they were not wholly or predominantly made of glass. Both these contentions of the respondents were rejected by the Commissioner and it was held by him that the magnifying glasses sold by the respondent fell under entry 44 of Schedule C to the said Act and attracted tax at the rate mentioned therein. The respondents then went in appeal before the Maharashtra Sales Tax Tribunal. At the hearing before the Tribunal, the learned Advocate for the respondents produced in Court two types of magnifying glasses, which had been sold by the respondents under the aforesaid Bill. One of these magnifying glasses consisted of a lens fitted with a frame and handle and the other of a lens installed on a stand. In this connection, it may be stated that the respondents had made an offer in their application dated 5th May 1966 to produce these glasses even before the Commissioner of Sales Tax. From the facts stated in the Judgment of the Tribunal, it appears that the magnifying glasses sold by the respondents consisted of lenses fitted with chromeoplated handle and frame and that the value of the lens in such a magnifying glass was much less than the costs of the handle and frame. It was sought to be contended by the learned Advocate for the respondents that in common parlance a magnifying glass was not regarded as glassware. But the Tribunal did not allow the learned Advocate for the respondents to urge this contention, as, according to the Tribunal, no evidence was led by the respondents to the effect that magnifying glasses were not sold by dealers in glassware. The Tribunal, however, came to the conclusion that the expression "glassware" in entry 44 of Schedule C to the said Act, must be held to comprise only such articles which are of domestic use, such as vessels, decorative pieces, sanitary ware and so on and that it could not be said that a magnifying glass was included in the said entry as it was not an article of daily use by common men. The Tribunal upheld the contention of the respondents that the said magnifying glasses were covered by entry 22 of Schedule E to the said Act.

(3.) The question referred to us for determination is as follows : "Whether the word 'glassware' appearing in entry 44 of Schedule C to the Bombay Sales Tax Act, 1959, at the material time included only glassware of domestic use and therefore magnifying glasses (optical appliances) were not covered by the said word 'glassware' in that entry ?"