Advocate Rajnish R. Singla
In order to discuss Entry No. 8 of Schedule –II B in Uttarakhand, it will be imperative to go through The Uttarakhand Vat Act, 2005.
The Entry No. 8 of Schedule- II B of The Uttarakhand Value Added Tax Act, 2005 is as under-
“All utensils and enamelled utensils (including pressure cookers and pans), buckets, jugs & mugs made of aluminum, “iron & steel”, plastic or other materials except precious metals.”
It has been held in Burnett Vs G.N. of Scotland Ry., 54 Law of Journal Queen’s Bench 539 by Lord Fitzgerald “All is equivalent to “each and every”. ‘
Utensil is defined in various dictionaries as under-
a. In Shorter Oxford Dictionary the meaning of the word “utensil” has been given as under:
“Any article useful or necessary in a house hold; a domestic implement, vessel, or article of furniture; an instrument or vessel in common use in a kitchen, dairy, etc; any vessel or other serving a useful end purpose; a tool or implement used by artisans, farmers, etc.”
The meaning of the word “utility” as per the aforesaid dictionary reads as under:
“A useful thing or feature; a use, an object that can satisfy a human need; anything which can satisfy a human want.”
b. In the Chambers Dictionary, the meaning of the word “utensil” has been given as under:
“Any useful or ceremonial implement, etc., serving a useful purpose; especially for domestic or farming use: fit for use.
c. In the Stroud’s Judicial Dictionary of Words & Phrases, Volume 3, Sixth Edition, defines the word “utensil” as under:
“Utensil.” Utensil, anything necessary for use and occupation; household stuffe’ (Cowel).”
d. In the Chambers 21st Century Dictionary, Revised Edition, defines the word ‘utensil’ as under:
“utensil ‘ju’tensil’- noun an implement or tool, especially one for everyday or domestic use. Cooking utensils.
e. In The New International Webster’s Comprehensive Dictionary of English Language, Encyclopedic Edition, defines the word ‘utensil’ as under:
“u-ten-sil (yoo-ten’sil) n. A vessel, tool, implement, etc., serving a useful purpose, especially for domestic or farming use.
From the aforesaid meaning assigned to the word “utensil” it is clear that the word “utensil” includes a vessel and the word “utensil” is not synonymous with word “vessel”. Utensil means any article useful or necessary in a household, commonly used in kitchen. In other words, an implement tool or vessel fit for use and serving useful purpose.
As the Entry No.8 of Schedule II B stands, the words used are “All utensils” “including”. The word “All” and “including” has special significance. The word “includes” is often used in interpretation clauses in order to enlarge the meaning of the words or phrases occurring in the body of the statute. When it is so used, these words and phrases must be construed as comprehending not only such things as they signify according it their nature and import, but also used in an inclusive definition denote extension and cannot be treated as restricted in any sense.
When we are dealing with an inclusive definition it would be inappropriate to put a restrictive interpretation upon the terms of wider limitation. As the word “utensil” is not define under the Act, but in entry No. 8 the word used is “all utensils” “including”, It is inappropriate to put a restrictive meaning to the word “utensil” as understood in common parlance. The word “utensil” is a term of wider denotation.
It was observed by The Hon’ble Supreme Court in the matter of M/s Deepak Agro Solution Limited V/s Commissioner of Customs, Maharashtra (2008) 8 SCC 358 held:-
“It is well- settled what is not excluded would be held to be included.”
Therefore, All utensils means- Each and every utensil made of any other material except precious metals.
It is well settled rule of construction that the words under in a law imposing a tax should be constructed in the same way in which they are understood in ordinary parlance in the area in which the law is in force. If an expression is capable of a wider meaning as well as narrower meaning the question whether the wider or the narrower meaning should be given depends on the context and the background of the case. The terms and concepts appearing in the taxing statutes require to be understood the way in which they have been defined in the statute and in the absence of such definitions in the statutes. They should be understood in their popular meaning and as understood in commercial or common parlance. The intention of the legislation which is paramount not only requires to be taken note of, but also the purpose for which the Legislature intends to levy tax at the reduced rate of tax.
The Hon’ble The Supreme Court in the matter of Dadi Jagannadham v/s Jammulu Ramulu (2001) 7 SCC 71. and observed as under :-
There is a settled principle of interpretation which is given as below:
(i) The court must start with the presumption that the legislature did not make a mistake.
(ii) The court must adopt a construction which will carry out the obvious intention of the legislature.
(iii) If there is a defect or an omission in the words used by the legislature, the court would not go its aid to correct or make statute or read words into it which are not there, especially when the literal reading produce on intelligible result.
In a taxing statutes words which are not technical expressions or words of art, but are words of everyday use, must be understood and given a meaning, not in their technical or scientific sense, but in a sense as understood in common parlance, i.e., ‘that sense which people conversant with the subject- matter with which the statute is dealing, would attribute to it”. Such words must be understood in their ‘popular sense’. The particular terms used by the Legislature in the denomination of articles are to be understood according to the common commercial understanding of those terms used and not in their scientific and technical sense ‘for the Legislature does not suppose our merchants to be naturalists or geologists or botanists’.”
The Hon’ble Supreme Court, in the matter of M/s Annapurna Biscuit Manufacturing Co. Kanpur v. Commissioner of State Tax, U. P. Lucknow (1981) 48 STC 254 and observed as under:-
“It is well settled rule of construction that the words under in a law imposing a tax should be constructed in the way in which they are understood in ordinary parlance in the area in which the law is in force. If an expression is capable of a wider meaning as well as narrower meaning the question whether the wider or the narrower meaning should be given depends on the context and the background of the case.”That famous legal latin maxim of natural justice is- expression unius est exclusion alterius; when there is express mention of certain things, then anything not mentioned is excluded.
It was observed by The Uttarakhand High Court in the matter of M/s Shriya Enterprises V/s Commissioner, Commercial Taxes, Uttarakhand (2012) 51 VST 413 (Uttara) – “The Use of the words “all” and “including” makes it apparently clear that it is an inclusive entry. The effect of the words “all” and the words “including fruit jams, jellies, fruit squash, paste, fruit drinks and fruit juices and achar (whether in sealed containers or otherwise)” under entry 6 of Schedule II (B) to the Act and the absence of any exclusion of potato chips within the said entry gives a clear legislative intent of potato chips under entry 6 of Schedule II (B).”
If Legislative intent is accepted in mind and the meaning of the word utensil as gathered from the aforesaid definitions is taken into consideration and the way entry is worded “all utensils” “including and when what is excluded from this definition is expressly stated it is clear that utensils made of other materials would fall within the words “all utensils” and falls within the Entry no- 8 of the Schedule II B of The Uttarakhand Value Added Tax Act, 2005.
Similar entry came up for consideration before The Karnataka High Court, in the matter of M/s Stovekraft Pvt. Ltd. v/s State of Karnataka, (2006) 4 VLJ 209 (Karn) and observed as under-
“Karnataka Value Added Tax Act, 2003, Section 4(1) (b), Schedule- III (after substitution w.e.f. 7.6.2005), Entry 5- Rate of Tax-* All utensils including pressure cookers and pans other than utensils made up of precious metals.
“Appellant is engaged in the manufacture and sale of utensils like pressure cookers, stoves, tavas, flasks etc.- The goods are subjected to tax at five different rates under the separate schedules deals with goods exempted from tax, Second Schedule deals with the goods exempted from tax, Second Schedule deals with the goods taxable @ 1%, the Third Schedule deals with the goods taxable @ 4% and finally the fourth Schedule deals with the goods taxable @ 20%- The unscheduled goods are taxable at the RNR of 12.5%- Appellant believed that the goods manufactured by it fell within ‘utensils’ taxable @4 % under Entry to the Third Schedule- It filed an application seeking advance ruling on the applicability of rate of tax on sale of stainless steel LPG stove, kerosene wick stove, aluminum non stick cook- ware, stainless steel vacuum flask etc.- Authority concerned held that stoves, vacuum flasks and kerosene wick stoves cannot be called kitchen utensils and were therefore liable to tax @12.5 %- Held – The ruling by the authority concerned is not sustainable”.
Therefore, Entry no. 8 of Schedule II B to a lay man means; all utensils and enamelled utensils (including pressure cooker and pans), buckets, jugs & mugs made of aluminium, “iron & steel”, plastic or other materials except precious metals. Strictly means, each and every utensil made of any other material except precious metal is covered.