REPORTABLE  

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS. 2983-2988 OF 2011 [Arising out of SLP (C) Nos. 4082-4087 of 2010]

Commissioner of Trade Tax, U.P.      …. Appellant

Versus

M/s. Kartos International Etc.        …. Respondent

JUDGMENT

Dr. MUKUNDAKAM SHARMA, J.

1. Leave granted.  

2. The  present  appeals  are  filed  against  the  impugned  

judgment  and  order  dated  25.5.2009  in  TTR  No.  

329/2007 & TTR No. 330/2007 & TTR No. 331/2007  

& TTR No. 332/2007 & TTR No. 333/2007 & TTR No.  

334/2007 passed by the High Court whereby the High  

Court  allowed  the  Trade  Tax  Revision  filed  by  the  

respondent and reversed the order passed by the Trade  

Tax Tribunal, UP (Noida Bench).

3. The issue that falls for our consideration in the present  

appeals  is  whether  scientific  and  biological  

instruments/equipments  manufactured  and  sold  by  

the  respondent/assessee  would  be  entitled  to  get  

exemption from payment  of  tax under the UP Trade  

Tax Act, 1948 (for short “the UP Act”) as well as the  

Central  Sales  Tax  Act,  1956  (for  short  “the  Central  

Act”)  in  view  of  the  notifications  No.  1166  dated  

10.4.2000.   The aforesaid issue was the only issue  

which was decided by  the  Tribunal  in  favour  of  the  

respondent – assessee and therefore in this appeal we  

are  required  to  answer  and  decide  the  said  issue,  

which is framed by us.

4. In order to answer the aforesaid issue which arises for  

our  consideration,  it  would  be  necessary  to  set  out  

some facts leading to filing of the present appeals.

5. The  assessee/respondent  is  a  proprietorship  firm,  

which  is  engaged  in  the  manufacture  and  sales  of  

various  “scientific  and  biological  

equipments/instruments,  which  are  used  mainly  by  

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biological  scientists  for  research  purposes  for  which  

the assessee is duly registered under the provisions of  

U.P.  Act  as  well  as  the  Central  Act.    The  

assessee/respondent  was  issued  a  notice  by  the  

assessing authority and the assessee appeared before  

the  assessing  authority  and  claimed  that  the  goods  

sold  by  it  are  exempted  from  tax  in  view  of  the  

notification no. 1166 dated 10.4.2000 and also claimed  

relief on account of Inter-State sales made to various  

government organisations and institutions against the  

Forms 3D and D.  

6. The Assessing Authority, after examining the accounts  

and details, issued a show cause notice to the assessee  

proposing to make the best judgment assessment on  

the basis of an inference that the assessee had effected  

sales  at  concessional  rate  of  tax  to  various  

organizations against the declaration of form 3D and  

form D even though the said organizations were not  

the  Government  organisations  and  no  benefits  of  

concessional rate of tax could have been claimed by  

the assessee. The assessing authority  further took a  

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view  that  the  goods  sold  by  the  assessee  are  not  

covered by the notification No. 1166 dated 10.4.2000  

and hence the goods of the assessee were liable to be  

taxed at the rate of 10% as unclassified goods.  

7. The  assessee  replied  to  the  show  cause  notice  and  

stated that  the  goods sold by the  assessee  are  fully  

covered by the notification no. 1166 dated 10.4.2000  

and that the assessee had charged and deposited tax  

at concessional rate on the Intra-State sales as well as  

Inter-State  sales  made  to  various  Government  

Organizations and institutions but claimed that it was  

exempted under the said notification also.  

8. The explanation as submitted by the assessee was not  

accepted by the  assessing authority  and assessment  

orders  were  passed  on  20.2.2004,  17.3.2005  and  

30.3.2005 for the Assessment Year 2001-2002,  2002-

2003  and  1998-1999  respectively  and  the  tax  was  

levied under the UP Act and also under the Central  

Act.  The Assessing Authority has accepted books of  

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accounts of the assessee as well as declared turnover  

but  rejected  the  benefits  of  declaration  Form 3-D/D  

and on the Intra-State/ inter-state sales made to the  

Central/  State  Government  organizations  and  also  

treated the goods as unclassified goods, declining it to  

grant benefit of exemption under notification no.1166  

dated  10.4.2000  holding  that  the  assessee  is  not  

entitled  to  get  exemption  under  the  aforesaid  

notification.    

9. Thereafter,  appeals  were  filed  before  the  Joint  

Commissioner  (Appeals)  and  by  its  common  order  

dated  31.12.2005,  the  Joint  Commissioner  (Appeals)  

dismissed both the appeals holding that the equipment  

manufactured and sold by the respondent are used as  

instruments  in  the  research  laboratories  for  

maintaining the environment  free from bacteria,  and  

therefore,  the  respondents  are  not  entitled  to  claim  

exemption.

10. The  Assessee/Respondent  filed  appeals  before  the  

Trade  Tax  Tribunal,  UP  (Noida  Bench)  and  the  

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Tribunal  by an order dated 21.2.2007 dismissed the  

appeals filed by the assessee/respondent holding that  

only  such articles  are  exempted  from tax  which are  

used  for  educating  children  such  as  maps,  charts,  

instrumental  box,  educational  globe,  biology  

instruments,  and  not  those  used  for  research  

purposes.

11. Thereafter, a Trade Tax Revision under Section 11 of  

the Trade Tax Act, 1948 was filed by the Respondent  

before the High Court of Allahabad and the High Court  

by  its  impugned  judgment  and  order  upheld  the  

contention of the assessee/respondent and held that  

the assessee is entitled to the benefit of notification No.  

1166 dated 10.4.2000 holding that the description of  

the goods made in the notification has been clarified to  

be  used  by  all  the  persons.   While  coming  to  such  

conclusions,  reference  was  also  made  to  the  Hindi  

version of the notification dated 10.4.2000 holding that  

the same makes it clear that the exemption has been  

granted to the instrument which has been used.  

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12. The aforesaid findings and conclusions arrived at by  

the High Court are under challenge in these appeals  

on which we heard the learned counsel appearing for  

the parties.   

13. Learned counsel appearing for the appellant submitted  

that the words “biology instruments” necessarily mean  

the instruments,  which are  used by the  students  in  

educational institutions, more particularly, in schools  

and colleges and not in research institutions.    It was  

also submitted that each word of the notification must  

be distinctly  read to  take  colour  from the  preceding  

words  by  applying  the  principle  of  ejusdem generis.  

Next  submission  was  that  the  equipments  

manufactured by the assessee could not be clubbed  

with other items as mentioned in the notification as  

the  goods  manufactured  by  the  assessee  are  not  

similar or identical as that of the goods mentioned in  

the notification.  It was also contended that the words  

“biology”  instruments and apparatus are  confined to  

the items used in the study of science of physical life  

in respect of plants and animals in school and colleges  

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but the goods in question supplied by the respondent  

are used in laboratories and research institute.     

14. It  was  further  submitted  that  the  assessee  himself  

never  treated  the  goods  in  question  as  “exempted  

goods”  but  treated  them  as  “taxable  goods”  under  

Section 3-A(1)(C) of the U.P. Act as unclassified goods  

and the assessee charged full rate of tax as is evident  

from the various cash memos, which are on record and  

also claimed concessional rate of tax against the Form  

3D (U.P. Act) and Form D (Central Act).    

15. It was further submitted that the plain language of the  

notification  is  to  be  read  for  the  purpose  of  

understanding its language and the common parlance  

meaning  or  the  popular  sense  meaning  should  be  

preferred over the technical or scientific meaning of the  

items  and  since  the  goods  manufactured  by  the  

assessee are not being used for the study of biology,  

the  same  is  not  entitled  for  exemption  from  tax.   

Reliance  was  also  placed  by  the  counsel  for  the  

appellant  on  the  Hindi  version  of  the  notification,  

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which  classifies  it  as  relatable  to  life  science  (Jeev  

Biology) taught in schools and colleges.

16. Learned  counsel  appearing  for  the  respondent,  

however,  refuted  the  aforesaid  contentions  of  the  

appellant  and  submitted  that  the  equipments  and  

instruments  which  are  being  manufactured  by  the  

assessee/respondent are mainly used for providing a  

safe  environment  for  scientific  experiments  and  

research work and also they are used for the safety of  

scientists  who  are  engaged  in  micro-biological  

research,  diagnostic  laboratories,  hospitals  and  

operation theatres.    According to the  counsel  these  

equipments  are  used  by  persons,  who  undertake  

research work on high risk diseases like T.B,  Hepatitis  

B, who are prone to get it and are at a higher risk of  

being infected by agents/ bacteria which they handle  

and therefore, the surroundings where such research  

work  is  being  undertaken  requires  to  be  made  free  

from contamination to prevent, reduce or eliminate the  

risk of spread of infectious disease. He urged that the  

main  purpose  of  these  equipments  is  to  provide  

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bacteria/dust  free  i.e  bio-clean  environment  in  the  

working chamber to prevent the risk of infections and  

the same are entitled for exemption.

17. It was further submitted that the word “biology” and  

“biological” are not different from each other and are  

interchangeable.

18. It was also submitted on behalf of the respondent that  

the entry also contains the word “maps” and “survey  

instruments and apparatus”.  The maps are used by  

the school students alone,  however,  these apparatus  

are  also  used  by  the  numerous  people  including  

geologists.   It was contended that the notification does  

not  only  include  the  word  biology  instruments  and  

apparatus, but also includes scientific instruments.  

19. On the basis of the submissions made by the learned  

counsel appearing for the parties, we have perused the  

records.

20. The fact  that the assessee himself  never  treated the  

goods as exempted goods and treated them as taxable  

goods  under  Section  3-A(1)(C)  of  the  U.P  Act  as  

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unclassified goods and  charged full rate of tax makes  

it clear that even the assessee was aware of the fact  

that  the  goods  does  not  fall  within  ambit  of  the  

notification dated 10.4.2000.

21. The other issue that came for consideration is whether  

there  is  a  difference  between  the  term  “Biology  

Instruments”  and “Biological  Instruments”.  The  term  

“Biology  Instruments”  refers  to  those  instruments  

which  are  used  in  the  education  of  Biology   as  a  

subject in the educational institutions.  But the words  

“Biological  Instruments”  should  be  interpreted  in  a  

broader sense, and it includes various articles which  

are  supplied  to  hospitals  and  medical  colleges  for  

various purposes including research.

22. The Hindi version of the Notification dated 10.4.2000  

is  “Jeev  Vigyan  Sammandhi  Upkaranikayen  Aur  

Sanyantra”.    That means the instruments which are  

used  for  the  study  of  Life  Science  (Jeev  Vigyan)  by  

students  in  educational  institutions.  The  various  

articles in question as manufactured and sold by the  

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respondent  are  not  meant  for  teaching  Life  Science  

(Jeev Vigyan) to be taught in educational institutions.  

The  articles  in  question  are  meant  for  Hospital,  

Medical  Colleges  and  Research  Laboratories  which  

may fall in the category of “Biological Instruments” and  

are outside the purview of “Biology Instruments” to be  

used by the students in educational institutions.  

23. Moreover,  classification of  any commodity  cannot be  

made on its scientific and technical meaning. It is only  

the  common  parlance  meaning  of  the  term  which  

should be taken into consideration for the purpose of  

determining the tax liability.   In the present case the  

commodities  that  have  been  grouped  together  are  

articles used in Education Institutions such as Maps  

Chart,  Sketch  Map,  Instrument  Box,  Educational  

Globes etc.  

24. This Court in the case of  Maharashtra University of  

Health  Sciences  Vs.  Satchikitsa  Prasarak  Mandal  

reported in (2010) 3 SCC 786 held as follows:-

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“27.  The  Latin  expression  “ejusdem  generis”  which means “of the same kind or nature” is a   principle of construction, meaning thereby when  general words in a statutory text are flanked by  restricted  words,  the  meaning  of  the  general   words are taken to be restricted by implication   with the meaning of the restricted words. This is   a  principle  which  arises  “from  the  linguistic   implication  by  which  words  having  literally  a  wide  meaning  (when  taken  in  isolation)  are   treated  as  reduced  in  scope  by  the  verbal  context”.  It  may be regarded as an instance of   ellipsis, or reliance on implication. This principle  is  presumed  to  apply  unless  there  is  some  contrary  indication  [see Glanville  Williams,  The  Origins and Logical Implications of the Ejusdem  Generis Rule, 7 Conv (NS) 119].

34.  It  is  also  one  of  the  cardinal  canons  of   construction that no statute can be interpreted in  such a way as to render a part of it otiose. It is,   therefore,  clear  where  there  is  a  different  legislative intent, as in this case, the principle of   ejusdem generis  cannot  be  applied  to  make  a  part of the definition completely redundant.”

25. This Court in the case of Ramavatar Budhaiprasad v.  

Asstt.  STO  reported  in AIR  1961 SC 1325 stated  

technical meaning of a commodity cannot be a basis  

for adjudicating the classification and held as follows

“3.  .......Reliance was placed on the dictionary  meaning  of  the  word  “vegetable”  as  given  in  Shorter  Oxford  Dictionary  where  the  word  is  defined  as  “of  or  pertaining  to,  comprised  or   consisting of, or derived, or obtained from plants   or their parts”.  But this word must be construed  not in any technical sense nor from the botanical   point  of  view  but  as  understood  in  common  parlance. It has not been defined in the Act and  being  a  word  of  every  day  use  it  must  be   construed  in  its  popular  sense  meaning  “that   sense which people conversant with the subject- matter  with  which the statute  is dealing would  attribute  to  it”. It  is  to  be  construed  as   understood  in  common  language;  Craies  on  Statute Law, p. 153 (5th Edn.). It was so held in   

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Planters  Nut Chocolate  Co.  Ltd.  v.  The King 1.   This  interpretation  was  accepted  by  the  High  Court  of  Madhya  Pradesh  in  Madhya  Pradesh  Pan  Merchants’  Association,  Santra  Market,   Nagpur v. The State  of Madhya Pradesh (Sales  Tax Department) 2 where it was observed:

“In  our  opinion,  the  word  ‘vegetables’   cannot  be  given the  comprehensive meaning  the term bears in natural history and has not   been  given  that  meaning  in  taxing  statutes   before.  The  term  ‘vegetables’  is  to  be  understood as commonly understood denoting  those ‘classes of vegetable  matter  which  are  grown in kitchen gardens and are used for the  table.’”

(emphasis supplied)

26. In  Hansraj  Gordhandas  Vs.  H.H.  Dave,  Asst.  

Collector of Central Excise and Customs reported in  

AIR 1970 SC 755, this Court held as follows:-

“It  is  well  established  that  in  a  taxing  statute   there is no room for any intendment but regard   must be had to the clear meaning of the words.   The  entire  matter  is  governed  wholly  by  the   language  of  the  notificatlon.  If  the  tax-payer  is  within the plain terms of the exemption it cannot  be  denied  its  benefit  by  calling  in  aid  any  supposed intention of the exempting authority. If   such  intention  can  be  gathered  from  the   construction of the words of the notification or by  necessary  implication  therefrom,  the  matter  is   different,  but that  is not the  case here.  In  this   connection  we  may refer to  the observations of   Lord Watson in Salomon v. Salomon & Co. 1:

“Intention of the legislature is a common but  very  slippery  phrase,  which,  popularly  understood  may  signify  anything  from  intention  embodied  in  positive  enactment  to   speculative opinion as to what the legislature   probably  would  have  meant,  although  there  has been an omission to enact it. In a Court of   Law or Equity, what the Legislature intended  

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to  be  done  or  not  to  be  done  can  only  be  legitimately ascertained from that which it has  chosen to enact, either in express words or by  reasonable and necessary implication.”

27. It would also be relevant to mention here that there is  

a  vast  difference  between  Biology  Instruments  and  

Biological Instruments.   The term Biology Instrument  

refers to a limited range of  instruments confined for  

their  use  in  study  of  Jeev  Vigyan only.    The  word  

Biological Instrument is a general word with its utility  

where wide scale applications including the goods as  

manufactured by the assessee/respondent are taken.  

In the Government  Notification dated 10.4.2000,  the  

words Biology Instruments have been referred.   This  

means that only such articles as meant for education  

institution for the study of Jeev Vigyan such as Maps  

Chart,  Instrument  Boxes,  etc.,  are  included  in  the  

notification  in  question.  Biological  Instruments  are  

outside the ambit of the said Notification.   The term  

“Biological  Instruments”  is  the  most  general  term,  

which comprises of goods manufactured and sold by  

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the  respondent.    But  such  goods  are  certainly  not  

Biology goods.

28. In the light of the aforesaid decisions of this Court we  

must  analyse as to whether  or not the principles of  

Nositur  a  Sociis or  the  principle  of  ejusdem  generis  

could  be  said  to  be  applicable  on  the  facts  of  the  

present case.   

29. Nositur  a  Sociis means  that  when  two  words  are  

capable of being analogously defined, then they take  

colour from each other.  The term ejusdem generis is a  

facet of Nositur a Sociis. The aforesaid principle means  

that the general words following certain specific words  

would take colour from the specific words.   

30. The counsel appearing for the appellant submitted that  

the aforesaid principles,  particularly,  the principle of  

Nositur a Sociis would be applicable to the facts of the  

present  case.   The  counsel  appearing  for  the  

respondent,  however,  submitted  that  the  aforesaid  

principle would have no application to the facts of the  

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present case as the words in the entry do not represent  

a  homogenous  class  as  maps,  educational  charts,  

scientific  mathematical  survey,  mechanical  drawing  

and biology instruments and apparatus, all belong to  

different categories of goods and they are not followed  

by any general words.   

31. We are  unable  to  accept  the  aforesaid  stand  of  the  

counsel  appearing  for  the  respondents  for  all  these  

goods which are mentioned in the aforesaid entry of  

the notification relate to articles used for study of life  

science  in  schools  and  colleges,  such  as,  maps,  

educational  charts,  scientific  mathematical  survey,  

mechanical  drawing  and  biology  instruments  and  

apparatus.  All of them belong to one class as they are  

the tools by using which a student would and could  

learn life science. In the aforesaid manner the doctrine  

of  Nositur a Sociis would be applicable to the facts of  

the present case.

32. At  this  stage  reference  could  also  be  made  to  the  

earlier entry on the same subject which was used in  

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the  notification  dated  20.05.1976.   In  the  said  

notification the entry was in the following manner:

“Maps,  Educational  Charts,  Instruments  Boxes,  Educational  Globes  and  instruments,  such  as  instruments  used  in  Mechanical  drawings  and  Biology used by Students.”

33. The aforesaid entry came to be amended subsequently  

and the entry vide notification dated 10.04.2000 was  

inserted  granting  exemption  to  the  sales  of  Maps,  

Educational  Charts,  Instruments  Boxes,  Educational  

Globes  and  Scientific  Mathematical  Survey,  

Mechanical  Drawings  and  Biology  instruments  and  

apparatus.  All these items are used by the students  

studying in schools and colleges.   

34. The respondent on the other hand manufacture and  

sell  the  articles,  such  as,  Bilogical  Safety  Cabinets;  

Laminar  Flow  Cabinets;  Fume  Hoods;  Air  Showers;  

Operation  Theatre  Modules;  Air  Curtains;  Air  

Conditioner  Modules;  Clean  Tents;  Clean  Room  

Garments; Pass Boxes; Air Handling, Filter etc.   These  

articles are manufactured and sold by the respondent  

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to  Hospitals,  Medical  Colleges,  Advance  Research  

Institutions and Laboratories.   

35. A glance at the aforesaid items would establish that  

what is exempted under notification dated 10.04.2000  

are basic items to learn the Life Science and which are  

instruments  and apparatus  for  learning  Biology  and  

other Life Science.  Therefore,  on applicability of the  

aforesaid  doctrine  and  also  on  considering  the  

intention of the Government for issuing the aforesaid  

notification  granting  exemption  for  learning  Life  

Science it is established that no exemption was desired  

for  the  articles  manufactured  and  sold  by  the  

respondent  but  it  was  meant  exclusively  for  articles  

used  by  the  students  of  schools  and  colleges.  The  

exclusion  of  the  word  students  in  the  subsequent  

notification  would  not  in  any  manner  materially  

change  the  intention  for  which  such  notification  is  

issued.

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36. This Court in the case of M/S Pradeep Agarbatties V.  

State of Punjab and Others 1997 8 SCC 511, held  

that: -

“Entries  in  the  Schedule  of  sales  tax  and  Excise  Statues  list  some  articles  separately   and some articles are grouped together, when  they  are  grouped together  each  word  in  the   entry  draws  colour  from  the  other  words,   therein.  This  is  the  principle  of  NOSITUR  A  SOCIIS.”

37. In the present case, the goods manufactured and sold  

by  the  assessee  are  not  meant  for  Educational  

Institutions but are meant for Research Laboratories.  

Hence the commodities in question are not covered by  

the  said  notification  dated  10.4.2000,  and  are  not  

entitled for exemption.  

38. In view of the aforesaid discussion and law laid down  

by the Supreme Court in earlier decisions, we are of  

the considered opinion that the appeals deserve to be  

allowed.   Accordingly,  the appeals  are  allowed.   The  

order passed by the High Court is set aside and the  

order of the Tribunal is restored.

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 ..........................................J        [Dr. Mukundakam Sharma ]

 ............................................J  [ Anil R. Dave ]

New Delhi, April 6, 2011

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