Delhi High Court
Commissioner Of Sales Tax vs J.R. Trading Co. on 16 July, 1991
Equivalent citations: 1992 85 STC 574 Delhi
Author: B Kirpal
Bench: B Kirpal, D Jain
JUDGMENT
B.N. Kirpal, J.
1. This is a reference under section 45 of the Delhi Sales Tax Act, 1975, in respect of the assessment year 1972-73 whereby the Appellate Tribunal has referred the following question to this Court :
"Where the hair removing soap (depilatory) manufactured and sold by the dealer is covered by entry No. 17 of the First Schedule appended to the Bengal Finance (Sales Tax) Act, 1941, as then in force in Delhi and its sale taxable under clause (a) of sub-section (1) of section 5 of the Act."
2. The dealer was carrying on the business of manufacture and sale of hair removing soap and shaving soap. It was contended that hair removing soap did not fall under entry 17 of the First Schedule to the Bengal Finance (Sales) Tax Act, 1941, as then in force in the Union Territory of Delhi. According to the dealer the said item was taxable at the rate of 5 per cent and not at the higher rate of 8 per cent.
3. The Sales Tax Officer held that hair removing soap was a cosmetic and taxable at 8 per cent. The Appellate Commissioner sustained this decision in appeal. The second appeal was filed to the Appellate Tribunal and it came to the conclusion that hair removing soap was a toilet article and was not covered by entry 17. Thereafter at the instance of the Commissioner of Sales Tax the aforesaid question has been referred to this Court.
4. The entry which we are called upon to interpret occurred in the First Schedule to the said Act and reads as follows :
"Cosmetics, but not including kum-kum and soap."
5. The aforesaid entry, possibly, assumes that kum-kum and soap are also cosmetics, but these two items, namely, kum-kum and soap are specifically excluded from entry No. 17.
6. It is no doubt true that the Appellate Tribunal has come to the conclusion that hair removing soap is not a cosmetic, but we need not go into that aspect for the simple reason that soap is excluded from entry 17. As noted by the Appellate Tribunal the said entry does not mention any particular type of soap. Therefore, all types of soaps, whether washing soap or bathing or any other type of soap, would be excluded from entry No. 17. A hair remover may be in the form of cream or it may be in the form of a liquid or in the form of a soap. When it takes the form of soap, as in the present case then it would be excluded from the operation of entry 17. The word soap in entry 17 is not qualified by any other word. We see no reason as to why hair removing soap should not be regarded as soap mentioned in entry No. 17 of the First Schedule of the said Act. This being so, entry No. 17 thereof has no application and the item in question would be liable to be taxed at the rate of 5 per cent.
7. For the aforesaid reason the question is answered in the negative and in favor of the dealer. There will be no order as to costs.
8. Reference answered in the negative.
