Commissioner of Trade Tax vs Hindu Super Store

Prakash Krishna, J.—The only controversy raised in the present revision relating to the assessment year 1988-89 is regarding applicability of rate of tax on mosquito repellent coil (kachhuwa chap agarbatti). The Tribunal by its order dated July 28, 1994 has held that mosquito repellent coil (kachhuwa chap agarbatti) is taxable as "pesticides and insecticides". Challenging this order present revision is at the instance of the Commissioner of Sales Tax. The assessing authority treated the mosquito repellent, as unclassified item and rejected the contention of the dealer that it is covered by the entry "pesticides and insecticides". He concluded that "kachhuwa chap agarbatti" is used as a mosquito repellent and it does not kill mosquito. The Assistant Commissioner (Judicial), the first appellate authority, expressed its approval on this point with further observation that it cannot be treated as "medicine". An argument, on the strength of a judgment of this Court, given in the case of Balsara Hygiene Products Ltd. 1986 UPTC 367 was raised before it to treat "kachhuwa chap agarbatti" as medicine, like "Odomos". The Assistant Commissioner (Judicial) distinguished this case on the finding that "Odomos" is applied on the skin, smoke of "kachhuwa chap agarbatti" is used as mosquito repellent.

This Court in the case of Commissioner of Sales Tax v. Balsara Hygiene Products Ltd. 1986 UPTC 367 , has held that Odomos is medicine although it is sold in shops other than medicine shops also. The judgment of the Supreme Court given in the case of Ramavatar Budhaiprasad Etc. Vs. Assistant Sales Tax Officer, Akola, , wherein it was held that "entries in Sales Tax Act should not be construed in any technical sense...but as understood in common parlance", has been followed.

Recently the Supreme Court has reiterated its earlier view in the case of Alpine Industries Vs. Collector of Central Excise, New Delhi, . The question was regarding duty of the product known as "Lip Salve" where its "preparations for the care of the skin and not as medicaments". The Supreme Court has followed the theory of "commercial parlance theory" and has held that product cannot be called as medicine as it is neither prescribed by any doctor nor obtainable from the Chemist of a Chemist shop in the market. Para 5 of the said judgment reads as under :

It is well-established that in interpreting tariff entries in taxation statute like Excise Act where the primary object is to raise revenue and for that purpose various products are differently classified, the entries are not to be understood in its scientific and technical meaning. The terms and expressions used in tariff have to be understood by their popular meaning, that is the meaning that is attached to them by those using the product. See the decision of Supreme Court on the dispute regarding classification for excise duty, the product--Dant Manjan Lal manufactured by Shree Baidyanath Ayurved Bhavan Ltd., reported in the case of Shree Baidyanath Ayurved Bhavan Ltd. Vs. Collector of Central Excise, Nagpur, . The manufacturer claimed the product to be an ayurvedic medicinal preparation product for dental care. The view of the Tribunal was upheld by this Court by holding that ''ordinarily a medicine is prescribed by a medical practitioner and it is used for a limited time and not every day unless it is so prescribed to deal with a specific disease like diabetes''.

The Good Night mats have been treated by the persons dealing with it as mosquito repellent. The Supreme Court in the case of Sonic Electrochem and Anr Vs. Sales Tax Officer and Others, , a case under the Gujarat Sales Tax Act, 1969 has held that "Jet Mat" is mosquito repellent. In Gujarat there is specific entry No. 129 of mosquito repellent. It has been held to be mosquito repellent mats and not as insecticide.

One of the constituents of Jet mats as mentioned in the judgment is "d-Allethrin 4 per cent". In that case also the certificate of registration in favour of the appellant issued u/s 9(3) of the Insecticides Act, 1968, the leaflet and the approved label of the commodity in question, the formulation contents of the said commodity and the chemistry of the active ingredients were submitted. Even then it was considered to be mosquito repellent and not as insecticide or pesticides. On the same reasoning the kachhuwa chap agarbatti cannot be held to be insecticides or pesticides. It is used as a mosquito repellent and not as mosquito killer.

In view of above, the order of the Tribunal cannot be sustained. The revision is allowed. No order as to costs.