- (1.) THIS is a revision under sec. 14 (2) of the Rajasthan Sales Tax Act, 1954 against the order of the learned Deputy Commissioner, Excise & Taxation (Appeals) Udaipur dated 14th January, 1962 whereby he upheld the order of the Sales Tax Officer, Udaipur dated 6th September, 1961.
(2.) THE brief facts of the case are that the applicant is a dealer in Gota and Kinari. For the assessment year i. e. from 1st November, 1959 to 19th October, 1960 the applicant disclosed a gross turnover of Rs. 84,539/11/9 out of which he claimed deduction of turnover of Rs. 43,792/9/3. He also claimed that the turnover of Rs. 21,243/4/- was taxable at half percent and that of Rs. 19,463/14/6 at one percent. He claimed that Gota and Kinari are articles made of gold and silver and they should not be taxed at the general rate. THE value of these articles amounted to Rs. 19,463/5/3. He further claimed that Gota and Kinari are within the meaning of tapes and laces which are totally exempt from the levy of tax vide Government Notification No. F. 5 (48) E & T/57 dated 1st July, 1958. His plea as far as Gota and Kinari are concerned was not accepted by the Assessing Authority. Against this order of the Assessing Authority he went in appeal before the learned Deputy Commissioner, Excise & Taxation (Appeals), Udaipur who after hearing him at length and going through the record as well as the citation given by the applicant came to the conclusion that the Gota and Kinari are not covered by the Notification referred to above and they are not exempt. He, however, held that Badla which also the applicant sold was nothing but gold and silver thread and should be taxable at the rate mentioned in the relevant notification. With these observations he rejected the appeal holding that the learned Sales Tax Officer had correctly taxed Gota and Kinari at the rate mentioned in the assessment order. Aggrieved by this order he has come in revision before us. It was argued before us by the learned counsel for the applicant that according to Government Notification No. F. 5 (48 ). E & T/57, dated 1st July, 1958, tapes and laces have been exempted from the sales tax and that Gota and Kinari came under the definition of the tapes and laces and should, therefore, be exempted. Since tapes and laces have not been defined in the Rajasthan Sales Tax Act, the dictionary meaning should be taken wherein the meaning of tape has been given as 'material wooven in narrow bands' and lace as 'string for passing through holes'. He further argued that in the alternative Gota and Kinari should be taxed at the rate at which the gold and silver articles are taxed viz. , one percent and not at the general rate at four percent. In this connection our attention was drawn to Government Notification No. F 5 (33) E & T/56, dated 30th April, 1956 and it was argued that Gota and Kinari come under the head of 'all articles (excluding ornaments) made of gold or silver. This notification remained in force till 8th March, 1960 when it was further amended vide notification No. F. 5 (8) E & T/60, dated 9th March, 1960 whereby the rate of tax was raised on the articles mentioned above to one percent. This was further clarified by notification No. 5 (8) E & T/60, dated 15th March, 1960. The learned counsel for the applicant also cited STC. 1962 page 669 wherein bullion has been taken to mean not only pure gold or silver but also an alloy of gold or silver with such small percentage of some other metal as does take away from it the character of bullion. On the same analogy it was argued that because of some cotton thread being used in Gota and Kinari they do not cease to be articles of gold and silver. He also cited 1954 STC page 71 State of Madras vs. Hajee M. S. A. Meeran Sahib Co. wherein it has been observed that the Madras General Sales Tax being a fiscal enactment and the rules framed thereunder also partake of the same character, the words in the statute should be strictly adhered to and no construction such as would favour the Government as against the subject should be put thereupon. It was contended on behalf of the State Government that tape and lace made of cotton are exempted and by no stretch of imagination can Gota and Kinari be treated as on par with tapes Niwars and laces which are made of cotton only. It was further argued that since nowhere has Gota and Kinari been defined or specifically mentioned in any of the notifications they cannot be treated and taxed on the same rate as all articles (excluding ornaments) made of gold and silver. They therefore, have been taxed at the general rate. We have heard the learned counsel for the applicant at great length and have also carefully gone through the record. The relevant portion of the notification dated 1st July, 1958 referred to above giving exemption runs as follows : ". . . . . . . . . . . . . . . . . . . . . The State Government being of the opinion that it is necessary in the public interest so to do. , does hereby unconditionally exempt from 1st July, 1958 from tax, the sale of - (i ). . . . . . . . . . . . (ii ). . . . . . . . . . . . (iii ). . . . . . . . . . . . . . . . . all varieties of textiles (other than pure silk cloth) made wholly or partly of cotton, rayon, nylon, wool or artificial silk including handkerchiefs, towels, napkins, dusters, cotton-valvets and velveteen, hosiery cloth in length excluding finished items thereof, tapes, niwars and laces. It was argued that the Deputy Commissioner has wrongly said that tapes and niwars are not exempted and the correct interpretation to be put on the notification would be that they are exempted as they come after thereof in the notification which that finished items of hosiery cloth in lengths alone have not been exempted and the word excluding does not apply to tapes, niwars and laces. It would be necessary for us to give any authoritative pronouncement on this point only if we come to the conclusion that Gota and Kinari come under the definition of tapes and laces. We agree with the counsel for the State that Gota and Kinari cannot be treated in the same class as tapes and laces of cotton as the trend of the notification shows. As such this notification is not applicable in the present case. As for the alternative argument that they should be treated as articles made of gold or silver we are not convinced by the arguments given by the counsel for the State Government that the Gota and Kinari are not covered by the above. The main constituent of Gota and Kinari are gold or silver. Their price also clearly shows that they are sold at a much higher price because of silver and gold in them than at a price where similar articles made of cotton could be sold. Moreover, this is an industry of considerable importance in Rajasthan and it would have greatly facilitated the work of the Assessing Authorities if the Government had cleared the position by specifically indicating the rate of tax leviable on Gota and Kinari. In the absence of any such notification we are of the opinion that Gota and Kinari should be taxed at the rate laid for all articles (excluding ornaments) made of gold and silver as envisaged in the various notifications mentioned above and not at the general rate at which they have been taxed. The learned Deputy Commissioner has already held that Badla should be taxable at the rate mentioned for all articles made of gold or silver. We, therefore, accept the revision as far as assessment of Gota and Kinari is concerned, set aside the order of the lower court and direct that a fresh assessment order be drawn on the basis of treating Gota and Kinari as articles of gold or silver assessing them at one percent. ;