PRAKASH KRISHNA, J. - (1.) QUESTION of law that arises as to whether the turnover of badh (baan) sold by the assessee should be taxed at the rate of 2 per cent as per entry No. 55. Entry No. 55 of Notification No. ST -2 -5785/X -10(1) -80 -U.P. dated September 7, 1981 reads as follows: December 24, 1986 (copy annexure 55. Yarn of all kinds except those covered by any M or I 2 per cent other notification.
(2.) HEARD the counsel for the parties and perused the record. The dealer -opposite party deals in badh (baan), rassi, jute, pattal, etc. The assessing authority for the assessment year in question 1984 -85 by its order dated October 7, 1988 found that the turnover of imported badh (baan) in U.P. is taxable at the rate of 6 per cent. This part of the assessment order was confirmed in appeal by the Assistant Commissioner 0udi -cial) dated June 28, 1989. The Tribunal concluded that badh (baan) is covered within the definition of 'yarn of all kinds' and as such is taxable at the rate of 2 per cent. Feeling aggrieved, the present revision challenging the rate of tax on badh (baan) at the rate of 2 per cent as held by the Tribunal, has been filed. Before the assessing authority the dealer -opposite party submitted that badh (baan) can be used for the purposes of making Rassi and in weaving of matting, etc. The assessing authority recorded a finding that Badh (Baan) cannot be included in the category of yarn. Badh (baan) is manufactured from a particular kind of grass. It is not 'yarn' but it is, itself a finished goods and is not generally used in weaving, knitting or rope making. It is used mainly in cots. Finished badh (baan) is a kind of a rope which is manufactured by spinning and is given shape of a rope. The Tribunal has not substantially disturbed the process of making badh (baan) as found by the assessing officer. However, it preferred the view that, badh (baan) is covered within the definition of yam and should be taxed accordingly at the rate of 2 per cent.
(3.) THE point which immediately falls for consideration is the meaning to be ascribed to the words 'yarn' and knitting 'yarn'. ''Yarn' has not been defined either in the Act and the Rules, or in the notifications. We have therefore to construe this term in its ordinary grammatical sense. According to 'Oxford Dictionary7, 'yarn' means: 'Any spun thread specially of kinds prepared for weaving, knitting or rope -making.' Webster's New World Dictionary also gives its meaning thus: 'Any fibre, as wool, silk, flax, cotton, nylon, etc., spun into strands for weaving, knitting or making thread.' Thus, a fibre in order to answer the description of 'yarn' in the ordinary commercial sense must have two characteristics. Firstly, it should be a spun strand. Secondly, such strand should be primarily meant for use in weaving, knitting or rope -making'. Commissioner of Sales Tax v. Sarin Textile Mills : AIR1975SC1262 . This decision has been followed in the case of M. Jafar A Majid v. Commissioner of Sales Tax STI 1982 All 78 : [1982] 4 STL 62 (All) : [1982] UPTC 451].;