Raj Brothers Agencies and Others vs The State of Tamil Nadu

V. Ramaswami, J.—In all these tax revision cases a common question of law arises. The two dealers who are petitioners in these cases have

manufactured and sold battery plates. They claimed that in respect of the turnover relating to these sales, they had to be assessed u/s 3(1) at multi-

point. But the assessing officer was of the view that it is liable to be taxed under entry 3-A of the First Schedule on the first sale in the State. This

order was confirmed in appeal by the Appellate Assistant Commissioner. On a further appeal, while agreeing with the contention of the assessees

that the battery plates cannot fall under item 3-A of the First Schedule, the Tribunal held that it is liable to be taxed at single point on the first sale in

the State under entry 41 of the First Schedule. It is the correctness of this view of the Tribunal, that is questioned in these batch of tax cases. The

Tribunal had brought it under item 41 on the ground that the battery plates manufactured and sold by the assessees were accessories to batteries

which are electrical goods and that, therefore, liable to be taxed under entry 41 only and not u/s 3(1) at multi-point. The battery plates which were

sold by the assessees in question are used in batteries as component parts. Originally, the batteries adapted for use as parts and accessories of

motor vehicles were included in item 3 of the First Schedule. Later on by amending Act No. 7 of 1965, the original item 3 was amended excluding

batteries from that entry and bringing it as a separate entry 3-A, which reads as follows :

Batteries (excluding dry cells).

By a further amendment dry cells also were brought under a separate entry as item 3-B of the First Schedule. At that stage, item 41, which dealt

with electrical goods and its accessories in general, was also amended by including the words ""other than those specifically mentioned in this

schedule"" in the appropriate place. Items 3-A and 41 were again amended by Tamil Nadu Act No. 15 of 1975, which came into force with effect

from 3rd March, 1975. Under the amended entry, item 3-A reads ""electric storage batteries and parts thereof including containers, covers and

plates"". These batch of cases relate to the assessment year 1969-70 and, therefore, the amended entry 3-A is not applicable. We have set out the

above amended provision also merely as a legislative history.

The learned counsel for the assessees contended that the department was bringing batteries adapted for use as parts and accessories of motor

vehicles under entry 3 and other kinds of batteries and accessories under entry 41 as electrical goods prior to the amendment of the provisions by

Madras Act No. 7 of 1965. By the amendment of that entry, all kinds of batteries, irrespective of the purpose for which it is used, excluding dry

cells, were brought under item 3-A. It was, therefore, contended by the learned counsel for the assessees that the batteries as such which have

been specifically brought in under entry 3-A, would not come within entry 41. If the main item of battery is not within the scope of item 41, it was

argued by the learned counsel for the assessees, its accessories could not be brought under that provision. On the other hand, the learned counsel

for the revenue contended that it is true that such a special entry, item 3-A, was introduced by the amending Act in the First Schedule. But still

battery is ""electrical goods"". Therefore, it would be covered by entry 41 as well and the accessories of batteries which have not been specifically

mentioned in entry 3-A would therefore have to be taxed under entry 41. We are of the view that accessories and component parts of electrical

goods, machinery, instruments, apparatus and appliances referred to in item 41 are only those accessories and component parts whose main article

to which it is an accessory or a component part are included in that entry. If the main article, to which it is an accessory or component part, is

taken out of that item, its accessories and component parts could not be said to have been left untouched. It might be that batteries are electrical

goods and the battery plates sold by the assessees are accessories or component parts of such batteries. But, in view of the specified entry in 3-A,

we are of the view that batteries as such were excluded under entry 41. The result of it is though in specific terms amending Act No. 7 of 1965 did

not exclude accessories and component parts of batteries from the provisions of entry 41, by introducing a new entry 3-A for batteries,

accessories and component parts automatically go out of the scope of entry 41. The learned Government Pleader contended that the words ""other

than specifically mentioned in the schedule"" were introduced only by the amending Act No. 11 of 1972 subsequent to the assessment year 1969-

70 and that, therefore, it is not impossible or incomprehensible that the same item of batteries falls under two entries, namely, under entry 3-A and

entry 41 and if so construed, batteries, as such, could be taxed under entry 3-A and accessories to batteries could be taxed under entry 41. The

argument is very attractive. But we are unable to accept this contention. Even without the words ""other than those specifically mentioned in the

schedule"" we would have reached the same conclusion on the well-known principle that a special entry overrides a general provision, the general

provision being electrical goods under entry 41 and the special provision being batteries under item 3-A. Therefore, the batteries could have been

taxed only under item 3-A and it could not have been brought under item 41. This is also made clear, if we may say so, by the amending provision

in Tamil Nadu Act No. 15 of 1975, which specifically included the parts of batteries including containers and covers and plates under item 3-A.

Since those including provisions were not there during the assessment year in question, the battery plates which are accessories to batteries, in our

opinion, had to be assessed and taxed u/s 3(1) and not under any of the entries in the First Schedule.

The learned Government Pleader next contended that in any case this might be brought in under the later half of entry 41. After enumerating

certain items like fans, lighting bulbs, electrical earthenwares and porcelain as being included in that entry, the entry further stated ""all other

instruments, apparatus, appliances, accessories and component parts, the use of which cannot be had except with the application of electrical

energy"". Even in this portion of the entry, we are of the view that accessories and component parts should be with reference to an article which falls

under that entry. We are, therefore, of the opinion that the Tribunal went wrong in holding that the battery plates would fall under item 41 of the

First Schedule. We are of the view that it is liable to be taxed only u/s 3(1) at multi-point in the relevant assessment year. In the result, all the tax

revision petitions are allowed with costs. Counsel''s fee is Rs. 150 in each case.