Case Law Details
Texonic Instruments Vs Commissioner of Commercial Taxes & Anr. (Supreme Court of India)
In a significant judgment, the Supreme Court of India addressed the classification of various components related to installation cables, outlet modules, patch cords, patch panels, network cards, and fibre optic cables under the Karnataka Sales Tax Act. This article delves into the details of the case of Texonic Instruments vs. Commissioner of Commercial Taxes and offers an analysis of the court’s decision.
Detailed Analysis:
1. Background: The case involved the classification of specific components used in installations and networking. These components included installation cables, outlet or connection modules, patch cords, patch panels, network cards, and fibre optic cables. The central issue was whether these components fell under Entry C.20(ii)(b) of the Second Schedule to the Karnataka Sales Tax Act, 1957.
2. Judgment Summary: The Supreme Court, after considering the matter, decided to uphold the impugned judgment. The court concurred with the view that the mentioned components were not covered under Entry C.20(ii)(b). This decision aligns with earlier judgments, including those in Collector of Central Excise vs. Grasim Industries and Castrol India Ltd. vs. C.C.E.
3. Interpretation of “That Is to Say”: The court referred to the interpretation of the phrase “that is to say” as provided in Stroud’s Judicial Dictionary. It explained that this phrase serves to clarify and fix the meaning of what is to be explained or defined. It does not expand the scope of the preceding words but instead offers a restrictive interpretation.
4. Words of Limitation: The expression “that is to say” in the relevant sub-heading (2710.60) was interpreted as words of limitation. This interpretation was crucial in determining the correct classification of the items in question.
5. Classification under Part ‘E’: Ultimately, the Supreme Court affirmed the classification of all the items under Part ‘E’ of the Second Schedule to the Karnataka Sales Tax Act, 1957. This classification was deemed to be in accordance with the law and the facts presented in the case.
Conclusion: The Supreme Court’s decision in the case of Texonic Instruments vs. Commissioner of Commercial Taxes provides clarity on the classification of installation cables, outlet modules, patch cords, patch panels, network cards, and fibre optic cables under the Karnataka Sales Tax Act. By upholding the classification under Part ‘E,’ the court ensures consistency with previous rulings and legal interpretations. This judgment serves as a reference point for future cases dealing with the classification of similar components under tax laws.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
Leave granted in the listed special leave petitions.
This Court find no reason to interfere with the impugned judgment which hold that installation cables, outlet or connection modules, patch cords, patch panels, network cards, fibre optic cables etc. are not covered in Entry C.20 (ii)(b) of the Second Schedule to the Karnataka Sales Tax Act, 1957.
The view expressed, conforms to the judgment of this Court, in the cases of Collector of Central Excise v. Grasim Industries: (2005) 3 SCR 466 and Castrol India Ltd. v. C.C.E.: (2005) 2 SCR 414, which had ruled that the phrase “that is to say” are to be given a restrictive meaning, rather than expanding the scope of the preceding words. In Castrol India (supra), it was held as follows:-
“In Stroud’s Judicial Dictionary, 4th Edition, Vol. 5 at page 2753, we find “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 dimnish it; (3) but where the physical clause is general in terms it may restrict it, see this explained with many examples, Stukeley v. Butler Hob, 1971”. The quotation, 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.
The expression “that is to say” in sub-heading 2710.60 has to be interpreted to be words of limitation. The fact that sub-heading 2710.60 contains an exclusion clause goes to show that there may be other lubricating oils which may fall in the residuary heading “others”.
Having regard to these facts, the Court is satisfied that the final decision classifying all the items in question, as falling in Part ‘E’ of the Second Schedule to the Karnataka Sales Tax Act, 1957 is correct.
The appeals are, accordingly, dismissed.
Pending application(s), if any, shall stand disposed of.
