N. M. KASLIWAL, J. -
(1.)ON a direction given by this Court, the Board of Revenue has sent the following question of law for the opinion of this Court : " Whether entry No. 23 of the Notification No. F. 5 (40)F. D. (R&t)63-XIII dated 2nd March, 1963, under the Rajasthan Sales Tax Act, 1954, and section 14 of the Central Sales Tax Act, 1956, covers G. P. and G. C. sheets within the term "iron and steel" when the petitioner purchases and sells these items in the same form in which it received them from the rolling mills ?" M/s. Rajasthan Iron and Steel Merchants Association (P.) Ltd. (hereinafter referred to as "the assessee") is a dealer in the business of sale of galvanised plain and corrugated sheets and galvanised wire purchased from M/s. Tata Iron and Steel Co. Ltd. or M/s. Hindustan Steel Ltd. The Commercial Taxes Department was treating such galvanised sheets and wires as "iron and steel" for sales tax purposes up to 31st December, 1963, and assessing such sales to tax at 2 per cent. The assessing authority started calculating sales tax at 6 per cent on items mentioned above from 1st January, 1964, in pursuance of a departmental clarification issued on the basis of an interpretation given by the Government of India that these would not come under the definition of "iron and steel" as defined under section 14 of the Central Sales Tax Act and as notified under the Government notification dated 2nd March, 1963. The Commercial Taxes Officer, Special Circle-II, Jaipur, while assessing sales tax for the assessment year 1963-64 held that from 1st January, 1964, onwards sale of G. P. sheets, G. C. sheets and G. I. wires attracted a general rate of sales tax at 6 per cent while prior to 1st January, 1964, sales tax was leviable at 2 per cent. An appeal filed by the assessee was dismissed by the Deputy Commissioner, Commercial Taxes (Appeals), Jaipur. The assessee than filed a revision application before the Board of Revenue. The Board of Revenue agreed with the contention of the assessee's counsel that the departmental circulars could not change the legal position which is governed by law and rules on the subject. The Board then examined the basic question whether G. P. and G. C. sheets and G. I. wires would fall under the category of "iron and steel" or not. If they fall under the category, then they will attract sales tax at the rate of 2 per cent but if they do not, then at the rate of 6 per cent. The Board of Revenue held that though corrugation was only a change in the shape of sheet, it did not really change the property of the matter, but in case of galvanisation the Board held that such a process where the entire metal area of the iron item is coated with another metal (zinc) there occurs a basic change in the nature and properties of the iron sheets or wires, and accordingly after this process of galvanisation they could not be strictly called merely items of "iron and steel". In view of this position, the Board of Revenue found that it had been rightly held that galvanised corrugated sheets or galvanised wires, no longer fall under the category of iron and steel under section 14 of the Central Sales Tax Act and as notified vide Government notification dated 2nd March, 1963. Thus, they attract sales tax at the rate of 6 per cent instead of 2 per cent.
(2.)THE Board of Revenue as regards the period earlier to 1st January, 1964, observed as under : " THEre is also the question as to why the higher rate should be levied from 1st January, 1964 and not for the earlier period. Once it is accepted that these items no longer fall under the category of iron and steel, the higher rate would be leviable for the relevant period, but we are prohibited from ordering its levy for the earlier period because that could be prejudicial to the assessee and we are barred from passing such order under section 14 (2) of the Rajasthan Sales Tax Act. "
In view of the above findings, the Board of Revenue dismissed the revision by its order dated 5th October, 1968. An application for making a reference was also dismissed by the Board of Revenue on 26th March, 1969. Thereafter the assessee submitted an application to this Court under sub-section (2) (b) of section 15 of the Rajasthan Sales Tax Act, 1954, requiring the Board of Revenue to state the case and refer the abovementioned question of law for answer by this Court. This Court by order dated 22nd November, 1973, directed the Board of Revenue to make a statement of the case and refer the aforesaid question for answer of this Court. In these circumstances the above question of law has been referred to this Court.
It may be mentioned at the outset that the Board of Revenue itself did not agree with the above view in latter decisions and in view of conflicting judgments, a larger Bench of the Board of Revenue was constituted to decide the above controversy. A larger Bench of the Board of Revenue consisting of three members in Radhaballabh and Sons v. State of Rajasthan reported in 1974 RRD 368 considered the above question and held that galvanised, corrugated sheets fell within the definition of "iron and steel" and that galvanisation and corrugation of the iron sheets or wires did not change their basic character from being iron and steel. The Board of Revenue placed reliance on a decision of the Andhra Pradesh High Court in State of Andhra Pradesh v. Sri Durga Hardware Stores, Vijayawada  32 STC 322. In the above Andhra Pradesh case it was held as under : " Galvanised plain or corrugated sheets and B. P. sheets fall within the ambit of 'iron and steel' in entry 2 of the Third Schedule to the Andhra Pradesh General Sales Tax Act, 1957. The words 'that is to say' occurring immediately after 'iron and steel' in entry 2 show that the legislature intended to adopt the most general concept of iron and steel and wanted all forms of iron and steel to be brought within that entry. Galvanisation is nothing but coating the iron sheet with zinc by an electrical process, or some other processes, to prevent it from oxidation. The galvanisation improves the utility of the raw material of iron. Corrugation is merely wrinkling of the sheets in one direction for the purpose of making the sheets more rigid and for giving increased stiffness so as to be more suitable for roofing and walling. Both corrugation and galvanisation improve the utility of the raw material. By the process of galvanisation and corrugation, the iron and steel do not lose their essential character as iron and steel. "
A similar view was taken by the Allahabad High Court in Commissioner of Sales Tax, Uttar Pradesh, Lucknow v. Tata Iron and Steel Company Ltd.  38 STC 10, by the Jammu and Kashmir High Court in Sales Tax Commissioner v. Jammu Iron and Steel Syndicate  45 STC 99, by the Calcutta High Court in Phanindra Nath Manna and Company v. Commercial Tax Officer  33 STC 292, and by the Gujarat High Court in State of Gujarat v. Shah Veljibhai Motichand, Lunawads  23 STC 288.
The matter then came to be examined by their Lordships of the Supreme Court of State of Tamil Nadu v. Pyare Lal Malhotra  37 STC 319 (SC ). Their Lordships of the Supreme Court considered section 14 of the Central Act. The list of goods given at No. (iv) as it stood in 1968 was as under : " (iv) iron and steel, that is to say, - (a) pig iron and iron scrap; (b) iron plates sold in the same form in which they are directly produced by the rolling mill; (c) steel scrap, steel ingots, steel billets, steel bars and rods; (d) (i) steel plates, --- | (ii) steel sheets, | sold in the same form in | (iii) sheet bars and tin bars, | which they are directly | (iv) rolled steel sections, | produced by the rolling mill. " | (v) tool alloy steel; --- By the Central Sales Tax (Amendment) Act (61 of 1972), clause (iv) was redrafted. It now reads as follows : " (iv) iron and steel, that is to say, - (i) pig iron and cast iron including ingot moulds, bottom plates, iron scrap, cast iron scrap, runner scrap and iron skull scrap; (ii) steel semis (ingots, slabs, blooms and billets of all qualities, shapes and sizes); (iii) skelp bars, tin bars, sheet bars, hoe-bars and sleeper bars; (iv) steel bars (rounds, rods, squares, flats, octagons and hexagons, plain and ribbed or twisted, in coil form as well as straight lengths); (v) steel structurals (angles, joists, channels, tees, sheet piling sections, Z sections or any other rolled sections); (vi) sheets, hoops, strips and skelp, both black and galvanised, hot and cold rolled, plain and corrugated, in all qualities, in straight lengths and in coil form, as rolled and in rivetted condition; (vii) plates both pain and chequered in all qualities; (viii) discs, rings, forgings and steel castings; (ix) tool, alloy and special steels of any of the above categories; (x) steel melting scrap in all forms including steel skull, turnings and borings; (xi) steel tubes, both welded and seamless, of all diameters and lengths, including tube fittings; (xii) tin-plates, both hot dipped and electrolytic and tinfree plates; (xiii) fish plate bars, bearing plate bars, crossing sleeper bars, fish plates, bearing plates, crossing sleepers and pressed steel sleepers, rails - heavy and light crane rails; (xiv) wheels, tyres, axles and wheel sets; (xv) wire rods and wires - rolled, drawn, galvanised, aluminised, tinned or coated such as by copper; (xvi) defectives, rejects, cuttings or end pieces of any of the above categories. " Their Lordships then considered the significance and effect of the use of words "that is to say" and held as under : " What we have inferred above also appears to us to be the significance and effect of the use of the words 'that is to say' in accordance with their normal connotation and effect. Thus, in Stroud's Judicial Dictionary, 4th Edn. , Vol. 5, at page 2753, we find : 'that is to say.- (1) "that is to say" is the commencement of an ancillary clause which explains the meaning of the principal clause. It has the following properties : (1) it must not be contrary to the principal clause; (2) it must neither increase nor diminish it; (3) but where the principal clause is general in terms it may restrict it : see this explained with many examples, Stukeley v. Butler, Hob 171. '
(3.)THE quotation, given above, from Stroud's Judicial Dictionary shows that, ordinarily, the expression 'that is to say' is employed to make clear and fix the meaning of what is to be explained or defined. Such words are not used, as a rule, to amplify a meaning while removing a possible doubt for which purpose the word 'includes' is generally employed. In unusual cases, depending upon the context of the words 'that is to say', this expression may be followed by illustrative instances. In Megh Raj v. Allah Rakhia AIR 1947 PC 72, the words 'that is to say', with reference to a general category 'land' were held to introduce, 'the most general concept' when followed, inter alia, by the words 'right in or over land'. We think that the precise meaning of the words 'that is to say' must vary with the context. Where, as in Megh Raj's case AIR 1947 PC 72, the amplitude of legislative power to enact provisions with regard to 'land' and rights over it was meant to be indicated, the expression was given a wide scope because it came after the word 'land' and then followed 'rights over land' as an explanation of 'land'. Both were wide classes. THE object of using them for subject-matter of legislation, was obviously to lay down a wide power to legislate. But, in the context of single point sales tax, subject to special conditions when imposed on separate categories of specified goods, the expression was apparently meant to exhaustively enumerate the kinds of goods on a given list. THE purpose of an enumeration in a statute dealing with sales tax at a single point in a series of sales would, very naturally, be to indicate the types of goods each of which would constitute a separate class for a series of sales. Otherwise, the listing itself loses all meaning and would be without any purpose behind it.
Learned counsel appearing for an intervener argued that the chemical composition of iron and steel affords a clue to the meaning of 'iron and steel' as used in section 14 of the Central Act. We are unable to agree that this could be what Parliament or any legislature would be thinking of when enumerating items to be taxed as commercial goods. The ordinary meaning to be assigned to a taxable item in a list of specified items is that each item so specified is considered as a separately taxable item for purposes of single point taxation in a series of sales unless the contrary is shown. Some confusion has arisen because the separate items are all listed under one heading : 'iron and steel'.
If the object was to make iron and steel taxable as a substance, the entry could have been : 'goods of iron and steel'. Perhaps even this would not have been clear enough. The entry, to clearly have that meaning, would have to be : 'iron and steel irrespective of change of form or shape or character of goods made out of them'. This is the very unusual meaning which the respondents would like us to adopt. If that was the meaning, sales tax law itself would undergo a change from being a law which normally taxes sales of 'goods' to a law which taxes sales of substances out of which goods are made. We, however, prefer the more natural and normal interpretation which follows plainly from the fact of separate specification and numbering of each item. This means that each item so specified forms a separate species for each series of sales although they may all belong to the genus : 'iron and steel'. Hence, if iron and steel 'plates' are melted and converted into 'wire' and then sold in the market, such wire would only be taxable once so long as it retains its identity as commercial goods belonging to the category 'wire' made of either iron or steel. The mere fact that the substance or raw material out of which it is made has also been taxed in some other form, when it was sold as a separate commercial commodity, would make no difference for purpose of the law of sales tax. The object appears to us to be to tax sales of goods of each variety and not the sale of the substance out of which they are made. As we all know, sales tax law is intended to tax sales of different commercial commodities and not to tax the production or manufacture of particular substances out of which these commodities may have been made. As soon as separate commercial commodities emerge or come into existence, they become separately taxable goods or entities for purposes of sales tax. Where commercial goods, without change of their identity as such goods, are merely subjected to some processing or finishing or are merely joined together, they may remain commercially the goods which cannot be taxed again, in a series of sales, so long as they retain their identity as goods of a particular type. "