ASHWANI KUMAR MISHRA,J. - (1.) Revenue is before this Court in the present revision, challenging the order passed by the Tribunal 20.12.2010, holding the product Latex Adhesive Solution, exempt from payment of VAT by virtue of notification No. 709 dated 27.2.2007 and notification no. 22951 dated 26.9.2001.
(2.) Assessee, herein, is engaged in the manufacture of Latex Adhesive Solution. The assessing authority treated the product not to be covered by any exemption notification. The assessee preferred a first appeal which has been allowed, relying upon materials brought on record before it. Thus aggrieved the revenue preferred a second appeal, which too has been rejected. Question that arises for consideration is as to whether Latex Adhesive Solution is a commodity exempt from payment of VAT under the notification issued by the State.
(3.) Learned Standing Counsel has placed reliance upon a Division Bench judgment of this Court in M/s Neeraj Industries, Bareilly v. Assistant Commissioner (Assessment)-II, Sales Tax, Bareilly and another, 1996 U.P.T.C. 475 in which following observations are made in para Nos. 6 and 7, which reads as Under:- "6. The question for consideration is whether the conclusion reached by the respondents that the petitioner is engaged in the manufacture of notified goods, i.e. rubber/rubber products as stated at Serial No. 5 of the notification (Annexure-1) is free from or involves any long drawn debate. It is disputed that the petitioner is engaged in the manufacture of solution being used as adhesive, from the latex. Before us, the Counsel for the petitioner urged that the latex in common parlance is known as rubber and, therefore, solution which is the end product of the petitioner is nothing but rubber or rubber product. No material whatsoever has been shown by the petitioner in support of such contention that the latex in common parlance is understood by the people as rubber. The cardinal principal of law is that the Courts should resort to grammatical or dictionary meaning an a given word should be understood in a way in which it is used in common parlance. There is nothing before us to show that the latex is synonymous to rubber in common parlance. This being so, taking recourse to dictionary meaning of the term latex will violate the principles of interpretation. The meaning of the word 'latex' as per the new Lexicon Webster's Dictionary is as follows:- "A Milky usually whitish fluid obtained from various trees and plants. It is the raw material of rubber." In Webster Comprehensive Dictionary Encyclopedic Edition Vol. II, the meaning of the word 'rubber' is as follows: "A tenacious, elastic material obtained by coagulating the milky latex of certain tropical plants." 7. From the meaning of the word latex, it is clear that it is the raw material for manufacturing rubber and rubber products in the same way as milk is a raw material for making curd, sheets, cheese, paneer etc. and as sugarcane juice is a raw material for sugar. So latex is synonymous to rubber it is so understood in common parlance. Latex is merely a raw material for rubber and rubber products. Latex cannot be used for the purposes for which rubber can be used. Rubber is tenacious and elastic material. Rubber is liquid as is the solution, manufactured by the petitioner from latex.";