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Showing contexts for: Tile in Raja Brick And Tile Industries, Rep. By ... vs The Addl. Commissioner Of Commercial ... on 18 November, 2004Matching Fragments
4. The Additional Commissioner of Commercial Taxes, who is the revising authority, has taken exception to the order passed by the first appellate authority, on the ground, that the order passed by the first appellate authority is erroneous and prejudicial to the interest of the revenue. Therefore, has initiated proceedings under Section 22-A (1) of the KST Act by issuing a show cause notice dated 7.11.1998, interalia directing the dealer to show cause why the order passed by the first appellate authority dated 9.6.1998 both under the KST Act and the CST Act should not be revised and set aside and the order passed by the assessing authority should not be restored. In the show cause notice he points out the omissions said to have been committed by the first appellate authority. In that, he notices that Sl. No. 8 of Part -T of Second Schedule to the Act relates to rate of tax on tiles; Sub-entry (iii) relates to roofing tiles other than country tiles and the rate of tax is only 5%. The sub-entry (iv) relates to other tiles liable to tax at 15% during the assessment year in question. The assessing authority understanding the meaning of the expression 'roofing tiles' as tiles used for roofing purpose only had levied tax at 5% only on a total turnover of Rs. 56,67,170/-. However, tiles other than roofing tiles amounting to Rs. 39,49,398/- have been rightly taxed at 15%. According to the revisional authority, the first appellate authority without properly considering the meaning of the expression 'roofing tiles' as understood in the common parlance or commercial circles, has allowed the appeals and has directed the assessing authority to levy tax on the entire turnover of the dealer in tiles under sub-entry (iii) of Entry 8 of Part-T of Second Schedule to the Act. The order so made by the first appellate authority, according to the revisional authority is not only erroneous but also prejudicial to the interest of the revenue.
5. The assessing authority in his assessment order notices the following factual aspects from the books of accounts produced by the dealer for verification at the time of assessment proceedings. They are:
I. The assessee concern has maintained two sales registers separately one for the sales of roofing tiles and ridges and the other for the sale of 'decorative tiles' such as weather proof tiles, flooring tiles, mini Spanish tiles, hexagon tiles, helmet tiles, torino tiles, glass tiles, etc, but for the purpose of sales tax returns, the assessee has not shown such bifurcated sales of roofing tiles and other tiles such as decorative tiles, instead has clubbed the two together and has filed the returns and admitted to tax only at 5%, instead of different rate of tax at 5% for roofing tiles under entry 8(iii) of Part -T of the Second Schedule to the Act and at 15% for other tiles under sub-entry (iv) of Entry 8 of Part -T of the Second Schedule to the Act.
II. The Intelligence Officer, who had inspected the business premises of the assessee had concluded the provisional assessments upto the date of assessment treating that the sales turnover of the assessee includes the ordinary roofing tiles and also decorative tiles which would fall under entry 8(iv) of Part -T of the Second Schedule to the Act.
6. After noticing these factual aspects, the assessing authority applying common parlance theory proceeds to hold as follows:
" In view of the above, the roofing tiles as per entry 8(iii) of the II Schedule of the KST Act 57 means the tiles normally used on wooden rafters basically to cover from sunlight, rain & wind. The tiles classified by the assessee as roofing tiles are the ones coming under the above category, whereas the tiles classified as decorative tiles by the assessee like weather tiles, bamboo tiles, floor tiles, torino tiles, mini Spanish 4 x 4 walls tiles, helmet tiles, hexagon tiles, etc. are the tiles which are used to given extra appearance to the building which fall under tiles other than roofing tiles under entry 8(iv) of II schedule of the KST Act 57. Therefore, the said tiles at rightly classified by the assessee as decorative tiles attract 8 x 8 at 15%. In view of the above, the request of the assessee to drop the proposal of levy tax at 15% on the sales turnover of decorative tiles at Rs. 39,318.00 is rejected."
15. Now coming back to Entry 8 of part-T of the Second Schedule to the Act, it speaks of tiles and the rate of single point tax leviable on the first or earliest of successive dealers in the State. The tiles are classified into mainly three categories and the fourth category is in the nature of a residuary item. The entry speaks of mosaic tiles and chips, ceramic and glazed floor and wall tiles roofing tiles other than country tiles. Sub-entry (iv) of Entry 8 of the Second Schedule to the act speaks of any other tiles not covered by items (i), (ii) and (iii) above. Sub-entry (i) of Entry 8 of the Second Schedule to the Act speaks of mosaic tiles and chips. In the modern architecture, mosaic tiles has different types and sizes but they are mainly used for the flooring purposes. Similarly, ceramic and glazed floor and wall tiles only mean ceramic and glazed tiles which are primarily used for the purpose of floor and wall of a building. The Legislature in its wisdom, when it enumerates mosaic tiles does not restrict the use for which the article is used in construction of a building but when it comes to ceramic and glazed tiles, the Legislature specifically specify the use for which it is made, and when it comes to entry 8(iii), it specifically states that the tiles are used for roofing purpose. The use for which the commodity is made is taken into consideration for the purpose of levy of tax and if the tiles are used for any other purpose other than roofing, it may not fall under sub-entry (iii) of Entry 8 of Part -T of the Second Schedule to the Act. The intention of the legislature, in our opinion, appears to be, the use to which the goods are put requires to be kept in view while interpreting the entries and sub-entries of part -T of Second Schedule to the Act. In our view, the Legislature intends to levy a lower rate of tax, if the tiles are used by the consumer for the purposes of using it as a roofing tiles and this may be, keeping in view the present trend that the common man or the persons who are below the poverty line may think of using tiles made of clay to make shelter for them by using ordinary tiles. The persons, who belong to affluent class may use tiles made out of clay to give better appearance while building their houses and they use the decorative tiles to give appearance to their building rather than to protect themselves from rain and shelter as the assessing authority notices in its order. Nodoubt it is true that the roofing tiles and decorative tiles arc manufactured by using a particular type of clay and may be using more or less similar process to obtain the end product. In our view, that cannot be the only criteria for deciding whether decorative tiles which are made of clay is the same as roofing tiles. Here the intention of Legislature which is paramount not only requires to be taken note of but also the purpose for which the Legislature intends to levy tax on 'roofing tiles' at a reduced rate of tax. In view of all these, in our view, the 'roofing tiles' simplicitor cannot be equated with the 'decorative tiles' which cannot fit into the meaning of the expression 'roofing tiles'.