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PETITIONER: M/S UNITED COPIEX (INDIA) PVT. LTD.

       Vs.

RESPONDENT: COMMISSIONER OF SALES TAX

DATE OF JUDGMENT:       25/03/1996

BENCH: SEN, S.C. (J) BENCH: SEN, S.C. (J) JEEVAN REDDY, B.P. (J)

CITATION:  JT 1996 (3)   658        1996 SCALE  (3)181

ACT:

HEADNOTE:

JUDGMENT:   [With Civil Appeals Nos. 4822-25 of 1996 (Arising out of  S.L.Ps. (C) Nos. 11306, 11307, 11308 and 11309 of 1994)].                       J U D G M E N T SEN, J.      Special leave granted.      In this  case we  have to decide whether ’rubber flaps’ manufactured by  the appellant  can be classified under sub- entry (2)  of Entry  43 in the Schedule to the Uttar Pradesh Sales Tax  Act, 148.  The relevant Entry in the Schedule has been set out in the judgment of the High Court as under:      "(1) Motor vehicles including motor      cars,  motor   taxi   cabs,   motor      cycles, motor  cycle  combinations,      motor scooters, mopeds, motorettes,      motor omni-buses, motor vans, motor      lorries,   motor   trucks,   jeeps,      station wagons and chassis of motor      vehicles and  bodies or  tankers or      motor caravans  built or  meant for      mounting  on   chassis   of   motor      vehicles,  but  excluding  tractors      whether on wheels or on tracts.      (2)    Components,     parts    and      accessories of  vehicles  specified      in sub-entry  (1) above,  including      tyres  and   tubes,  batteries  and      trailers adapted for use along with      the said  vehicles, other than such      trailers as  are predominantly used      along with any other vehicles."      The appellants  are manufacturers of rubber flaps which are used  for giving support to the rubber tubes used in the tyres of  motor vehicles. The contention of the appellant is that such  rubber flaps  do not  fall under any of the items specified in  the Schedule  and, therefore,  they should  be taxed as unclassified items for which the rate of tax is 8%.

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The Assessing  Officer, however,  taxed the  turnover of the rubber flaps  under sub-entry  (2) of  Entry 43  of the said Schedule, treating  the rubber  flaps to  be an accessory of motor vehicles.      The assessee’s  first appeal to the Statutory Appellate Authority failed.  The assessee  thereafter appealed  to the Tribunal. The  Tribunal noted  the argument  of the assessee that the  flaps were used between the wheel rim and the tyre tube of  bus, trucks  and other heavy vehicles, rubber flaps were manufactured  from rubber  and that  the  assessee  had treated flaps  taxable as  unclassified item in the category of rubber  products. The  Tribunal also took note of the two judgments placed  before it but distinguished them on facts. It was  pointed out  that in the case of Modi Rubber Ltd. v. State of  Kerala Government  (1991) 81  STC 225, Kerala High Court held  that rubber  flaps came  under the  category  of ’rubber products’.  But in  the Uttar Pradesh Act, there was no separate  classification of  rubber products  as  taxable goods. Hence  no decision  about taxability  of rubber flaps could be taken in the light of the Kerala Judgment.      The case  came before  the  Allahabad  High  Court  for Revision under  Section 11  of the  U.P. Sales  Tax Act. The High Court  held that  "in the  face of  the undisputed fact that the  article in question is used for the protection and support of  rubber tubes  in the wheels of heavy automobiles there seems  to be  no escape  from the  conclusion that the rubber flap has to be treated as accessory of motor vehicle. Although there  is no  direct evidence about the sale of the rubber  flap  in  automobile  market  yet  in  view  of  its exclusive use it can be presumed that it is an item which is sold in  the automobile  market." In  the case  of State  of Orissa v.  Dunlop India  Ltd., (1993)  91 STC  379,  it  has specifically been  mentioned that  flap  is  commercially  a distinct identifiable  commodity available  for sale  in the automobile market. The High Court upheld the decision of the Tribunal that  the rubber  flaps were taxable as ’accessory’ of motor vehicle.      This judgment is now under appeal in this Court.      Under sub-section  (d) of  Section 3A of the U.P. Sales Tax Act,  1948 a  dealer has  to pay  tax on the turnover in respect of  goods specified  in the  Schedule to  the Act at such rate  as  the  State  Government  may  by  notification declare. Sub-section  (e) of  Section 3A  provides for goods other than  those referred  to in clauses (a), (b), (c), (d) of Section 3A will be charged the tax at the rate of 8%. The contention of the assessee is that rubber flaps manufactured by it  do not  fall under  any of  the specific heads in the Schedule and, therefore, the only way to tax rubber flaps is by taking recourse to sub-clause (e) of Section 3A(1).      Entry 43  of the  Schedule is  in two  parts. The first part [sub-entry  (1)] deals with motor vehicles. Motor cars, motor taxi,  cabs, motor  cycles, motor  cycle combinations, motor scooters, mopeds, motor trucks, jeeps, station wagons, chassis of  motor vehicles  etc. have  all been  included in this sub-entry.  The second  part [sub-entry (2)] relates to components, parts  and accessories  of vehicles mentioned in sub-entry (1)  including tyres, tubes, batteries and certain types of trailers.      Whether ’rubber  flap’ can  at all  be  treated  as  an accessory is  a debatable  issue. From what has been brought on record  rubber flap  is a protective device. It is placed between the tube and the rim, possibly to save the tube from coming into  direct contact  with overheated  rims  on  long drives. In  the Central  Excise & Tariff Act, flaps have not been treated  as accessories  of motor  vehicles. Flaps  are

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taxable under  Tariff Item  40.12 under the Heading Solid or Cushion Tyres, Interchangeable Tyre Treads and Tyre Flaps of Rubber. That means the flaps will not come under the heading "parts and  accessories" of motor vehicles in Entry 87.05 in Chapter 87 of that Act. It is well accepted that the entries in the  Schedule to  the Excise  Act have been stated in the language of the market place and are to be understood as the market-people understand  them. If  the flaps are treated as Car accessories  in market parlance, then there is no reason to treat  it separately  and independently  as  an  item  of rubber product in Chapter 40.      This, however,  cannot conclude  the dispute  raised in this case  but is  a  good  indication  of  the  legislative intent. The  flaps have  not been  understood or  treated as accessories of  motor vehicles by the legislature in another central revenue Act.      Be that  as it may, the short question in this case is, having regard  to Entry 43 in the Schedule to the U.P. Sales Tax Act, can it be said that the ’rubber flaps’ manufactured by the  assessee can  come within  the  phrase  ’components, parts and  accessories of  vehicles specified  in  sub-entry (1)? ’Rubber  flaps’ can hardly be described as an accessory of a  vehicle. Meaning  of  ’accessory’,  according  to  the Webster Comprehensive  Dictionary, International Edition, is ’a person  or thing  that aids  subordinately;  an  adjunct; appurtenance; accompaniment’.  The ’rubber  flap’, which  is used to  protect the  tubes of the tyres, is not an adjunct, appurtenance or  accompaniment to  a motor  vehicle. At  the highest, it can be said that it increases the life of a tube by keeping  it away  from direct  contact with  the rim of a wheel. Sub-entry (1) does not include tyres and tubes or any other component, part or accessory within the description of ’motor vehicles’. Tyres and tubes have been specifically and separately mentioned in sub-entry (2) alongwith ’components, parts and  accessories of  vehicles specified  in  sub-entry (1)’. The  flap may  be used as an adjunct to the tyre or an extra piece  of rubber  to give additional protection to the tubes. It  may, at  the highest,  be an accessory of an item falling under  sub-entry (2)  of Entry  43, but it cannot be treated as  an accessory  of the  motor vehicle itself which falls in sub-entry (1). Even on the basis of facts as found, it cannot be said that the ’tyre flaps’ will fall within the description  of   ’components,  parts   and  accessories  of vehicles specified in sub-entry (1)’.      This distinction  was pointed  out in  the case of Modi Rubber Ltd.  v. State  of Kerala, (1991) 81 STC 225. In that case, Kerala  High Court  had to deal with the following two Entries:                     "THE FIRST SCHEDULE            Goods in respect of which single point            tax is leviable under sub-section (1)               or sub-section (2) of Section 5.      -------------------------------------------      Sl. Description of   Point of      Rate of          goods            levy          tax      -------------------------------------------       39.Rubber products  At the point  8          other than       of first sale          those speci-     in the State          fically ment-    by a dealer          ioned in this    who is liable          Schedule.        to tax under                           section 5.      138.Motor vehicles,  At the point   15."          motor vessels,   of first sale

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        motor engines,   in the State          chassis of motor by a dealer          vehicles,        who is liable          trailers, motor  to tax under          bodies built     section 5.          on the chassis          of motor          vehicles, bodies          built for motor          vessels, or          engines, and          spare parts and          accessories          thereof.      --------------------------------------------      Dealing with Entry 138, it was observed by the Court:      "Counsel for  the Revenue submitted      that rubber  flaps manufactured and      sold by the revision petitioner are      accessories of  the spare  parts of      motor vehicles,  specified in entry      138 of  the First  Schedule to  the      KGST Act.  We are  of the view that      entry 138 refers to motor vehicles,      motor vessels, motor engines, etc.,      and  spare  parts  and  accessories      thereof, which means spare parts of      motor  vehicles,   motor   vessels,      motor  engines,   etc.  The   words      ’accessories thereof’  in entry 138      of   the    First   Schedule   have      reference to  motor vehicles, motor      engines, etc.,  and not  the ’spare      parts’, immediately  preceding  the      words occurring  in the  entry. The      Appellate Tribunal  was in error in      holding    that     rubber    flaps      manufactured  and   sold   by   the      revision petitioner are accessories      of spare  parts of  motor vehicles,      coming under entry 138 of the First      Schedule to the KGST Act."      In the  instant case,  Entry 43  has been split up into two parts. The first part deals with motor vehicles etc. and the second part deals with components, parts and accessories of vehicles mentioned in the first part. Tyres and tubes are included in the phrase ’components, parts and accessories of vehicles’. A  protective cover  like a  rubber flap  may  be treated as  an accessory  of something which is an accessory of the  motor vehicle. But that will not make the protective cover an accessory of the motor vehicle itself.      A question  may arise  whether the  accessory of a tyre tube can  be anything  but accessory  of the  motor  vehicle itself. In  other words  the accessory  of a  part  must  of necessity be  the accessory  of the composite whole which is the motor  vehicle in  this case.  This interesting question need not  be pursued  in this  case. ’Tyres  and Tubes’  and ’Motor Vehicles’ have been classified separately under Entry 37. That  means tyres  and tubes  have not  been included in motor vehicles.  A rubber  flap  will  be,  if  at  all,  an accessory of  the tyre  or the tube falling in sub-entry (2) and not  of motor vehicles in sub-entry (1). The Legislature in its  wisdom has classified the tyres and tubes separately in sub-entry  (2) and  not along with motor vehicles in sub- entry (1).  A flap  being an accessory of an article falling

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under sub-entry  (2) cannot be classified as an accessory of an article falling in sub entry (1).      At the  conclusion of  the hearing of the case, we were referred to some amendments made in sub-entry (1) which does not have  any material bearing on the dispute raised in this case. It is not necessary to refer to these amendments.      We are of the view that this appeal must succeed and is allowed. The  judgment of  the High  Court dated January 18, 1994 is set aside. There will be no order as to costs. CIVIL APPEALS NOS. ......................................... of 1996 (ARISING OUT OF S.L.Ps. (C) NOS. 11306, 11307, 11308 and 11309 of 1994)]. ------------------------------------------------------------      Special leave granted.      In view of our judgment in Civil Appeal No. ........... of 1996 (arising out of S.L.P. (C) 11305 of 1994), the above appeals are allowed. There will be no order as to costs.