w w w . L a w y e r S e r v i c e s . i n

Ratan Packers Pvt. Ltd. v/s State of M.P. & Others

Company & Directors' Information:- L C PACKERS PRIVATE LIMITED [Active] CIN = U25202DL2012PTC241798

Company & Directors' Information:- RATAN PACKERS PVT LTD [Active] CIN = U25202MP1995PTC009302

Company & Directors' Information:- K M D PACKERS PRIVATE LIMITED [Active] CIN = U74950DL2000PTC104742

Company & Directors' Information:- PACKERS INDIA PVT LTD [Active] CIN = U99999MH1985PTC038391

Company & Directors' Information:- Q E D PACKERS PRIVATE LIMITED [Active] CIN = U74950DL2001PTC110725

Company & Directors' Information:- S S A S PACKERS PRIVATE LIMITED [Active] CIN = U21029WB2012PTC179508

Company & Directors' Information:- J. S. PACKERS PRIVATE LIMITED [Active] CIN = U36991UP1995PTC018211

Company & Directors' Information:- PACKERS (INDIA) PRIVATE LIMITED [Strike Off] CIN = U14102KA1999PTC024636

Company & Directors' Information:- PACKERS PRIVATE LIMITED [Active] CIN = U21010MH1968PTC014058

Company & Directors' Information:- K B S PACKERS PVT LTD [Strike Off] CIN = U99999UP1972PTC003540

Company & Directors' Information:- A & A PACKERS PRIVATE LIMITED [Active] CIN = U63090UP2011PTC047868

Company & Directors' Information:- S H K PACKERS PRIVATE LIMITED [Strike Off] CIN = U21000HP2013PTC000458

    W.A. No. 540 of 2007

    Decided On, 23 August 2013

    At, High Court of Madhya Pradesh


    For the Appellant: Nandita Dubey, A.L. Dhakad, Advocates. For the Respondents: R1 to R4, Vivek Khedkar, Deputy Advocate General.

Judgment Text

J.K. Maheshwari, J.

1. Assailing the order dated 4th July, 2007 passed by Writ Court in Writ Petition no. 2682/2006 filed by the appellant seeking the benefit of subsidy, under the Scheme, this writ appeal has been preferred under Section 2(1) of M.P. Uchcha Nyayalaya (Khand Nyayapeeth Ko Appeal) Adhiniyam, 2005.

2. The facts, in brief, for just adjudication of the matter are that the appellant/petitioner before this Court, namely, "Ratan Packers Pvt. Ltd., is a company registered under the Companies Act 1956 having its permanent Office in the name of 'Ashirwad Bhawan', Jayendraganj, Lashkar, Gwalior. Its industrial unit is situated at Plot No. K.-12B 13-C Industrial Area Ghirongi Malanpur District Bhind and engaged in manufacturing the "corrugated boxes" used for industrial packings. Being a small-scale industrial unit, the appellant-company also got registered for getting capital subsidy through State Government under the Scheme. Being eligible applied for grant of subsidy but respondent no. 5 the General Manager District Trade and Industries Centre rejected its claim, whereas the claim of another industry 'M/s Compact Pack Moulders Pvt. Ltd. Malanpur manufacturing the same product i.e. "Corrugated Boxes" was allowed. Being aggrieved by the action of respondent No. 5, the appellant came up before this Court by filing Writ Petition No.1704/2001. Vide order dated 16th of September, 2005 this Court disposed of the said Writ Petition with the direction to the District Level Committee to re-examine the case of the petitioner in the light of the policies and guidelines of the State Government and after taking note that the benefit of subsidy is granted to other similarly situated establishments, thus decide the question afresh within three months from the date of receipt of certified copy of the order, however, the earlier order of rejection was quashed.

3. Pursuant to the said directions, respondent No. 3 convened the meeting on 06f January, 2006 but again rejected the claim put forth by the appellant/petitioner by the District Level Committee making reference of the 76th meeting of the State Level Committee dated 16-02-2001. By which it was decided that corrugated box would fall in the schedule of ineligible industry for subsidy, in the entry at Serial No. 40, within the purview of "items made of paper like paper tube". It is said that corrugated box would all within the items made of paper, however, such industries are ineligible. The benefit granted to the M/s Compact Pack Moulders Pvt. Ltd was not denied but looking to the subsequent decision of State Level Committee the claim of subsidy to the appellant was denied holding that petitioner would not be entitled to claim the benefit at par to M/s Compact Pack Moulders Pvt. Ltd.

4. After passing the order by the District Level Committee, the petitioner has filed the writ petition bearing No. 2682/2006 which has been dismissed by learned Single Judge, by the order impugned, against which this appeal has been preferred. In the order, learned Single Judge after referring the findings recorded by District Level Committee, and the entry No. 40 of Schedule II of the State Policy, observed that in the said entry "items made of paper" is the benchmark and the test to determine the nature of products and the example so given as "paper-tube" or "paper cone making" is illustrative, and not exhaustive. It has further been observed that if the corrugated box is the item made of paper, then petitioner-industry cannot escape from the said entry. Further referring the fact that taxing statute should be understood by its meaning in common parlance, it must give a sense by which the people are conversant. Thus, referring the meaning of word "paper" "corrugated paper", recorded the finding that the "corrugated box"is a "box" prepared by the use of wrinkle papers and other papers. However, the reason so assigned by the District Level Committee was found justifiable, as such writ petition was dismissed.

5. Smt. Nandita Dubey, learned counsel appearing on behalf of appellant has contended upto length that learned Single Judge committed an error while passing the order impugned upholding the order passed by District Level Committee. It is submitted that in the matter of granting subsidy the object for which the statutory scheme was floated is required to be seen. The scheme specifically offers the benefit of subsidy to the new industrial units and existing units undertaking, for expansion. The object was to increase industrial activity and to encourage them in State. Simultaneously, it was also found desirable to not to extend the benefit to all such small scale industries which do not fall in rules, therefore, Schedule II was attached to the said scheme enlisting the industries not entitled to subsidy. Thus, Schedule II is exclusionary to the exemption notification, which ought to be construed strictly. In this case, the exemption of subsidy was denied to the petitioner because the corrugated boxes fall within the purview of Entry No. 40 of said list. In a case where the notification specifies a particular industry is excluded from the benefit of subsidy, it ought to be construed strictly. There cannot be any room or intendment and regard must be given to the clear meaning of the word. Bringing the produce "paper tube" and "corrugated box" before the Court, she tried to demonstrate that the manufacturing of the paper tube, which is excluded from subsidy using the word "like" is different than "corrugated box". Learned Single Judge has not properly appreciated the meaning of the word "paper", "corrugated box" and the word "like". It is further submitted that the benefit of subsidy has been granted to M/s Compact Pack Moulders Pvt. Ltd., manufacturing "corrugated boxes" at the same place, however, petitioner has been discriminated. The decision taken by the State Level Committee in 51st meeting to grant benefit of subsidy was withdrawn without any reason for rhyme in subsequent meeting. The interpretation put into reverse in 76th meeting of the State Level Committee in furtherance to the clarification of the Commissioner, Sales Tax to reject the claim of the petitioner and to deny at par benefit to appellant is discriminatory. In view of the foregoing, prayer is made to grant subsidy and to set aside the impugned order allowing this appeal.

6. Per contra, Shri Vivek Khedkar, learned Deputy Advocate General appearing for the State Government, has argued in support of the finding so recorded by learned Single Judge and submitted that "corrugated box" which is manufactured by the petitioner industry would fall within the purview of "items made of paper", however, learned Single Judge has not committed any error accepting the recommendation of District Level Committee and dismissing the petition, thus, appeal may be dismissed upholding the order impugned.

7. Before entering into the question involved, we have to look at the provisions of the 'State Investment Subsidy Sanction Rules, 1989, hereinafter it be called "the 1989 Rules" which were made effective to the industries started production with effect from 1st September, 1989 in all the districts of the State, except the notified limits of Municipal Corporation, town/cities having population exceeding one lac or more, or industries established within a radius of eight kilometre from the boundary of towns as enumerated in clauses (1) and (2) of 1989 Rules for receiving Central and State Investment Subsidy to a pioneer industries with fixed capital investment of Rs.Three Crores for more, on submission of application form alongwith information and documents as required for claiming State Investment Subsidy to Industrial Commissioner of On applying by the claimant, all the cases shall be examined by the distributing agency and be referred to the District/State Level Committee constituted under the relevant rules as the case may be. At last, the District Level Committee in conformity with the requirements as mentioned shall sanction the subsidy to the industries eligible for the same. Thereafter the agencies of the State mentioned in Rule 5(J) will distribute the State Investment subsidy on the basis of prior sanction of District Level/State Committee in the first instance and later prefer claim for reimbursement with the State of M.P. The composition of District or State Level Committee is described in Rule No. 8(1) of the said Rules. The State Level Committee is authorized to sanction subsidy upto 30 lacs and district level committee is authorized to sanction subsidy upto 3 lacs. Rule (13) specifies that where any matter arises for difference of interpretation, or in case any suggestions are made in regard to implementation of the scheme, such matter shall be referred to the Industries Commissioner, Madhya Pradesh, Bhopal and his decision shall be final and binding. The industries which are not entitled to claim the benefit of subsidy have been specified in Schedule II appended to the Rules of 1989. Thus, Schedule II indicates exclusionary entries of the Industry.

8. On perusal of record, it is not in dispute that the petitioner industry is having valid registration and is a small scale industry, wherein production was started on or after 01.09.1989. It is also not in dispute that it had applied for disbursement of subsidy on 12.11.1996 at that time the circular dated 09.03.1993f was in existence, though it was cancelled on 17.02.1998.Thus, on the date of submission of application for grant of subsidy under the scheme of State Government, the Rules of 1989 were in existence. As per Schedule II of the policy certain industries have been excluded to grant the benefit of subsidy. In this case, petitioner has been denied the benefit of subsidy because the manufacturing of the "corrugated boxes" fall within the entry No.40 of Schedule II of the policy, however, the said entry is required to be reproduced which reads as under:

No. 40 "Items made of paper like paper tube and paper cone making"

9. It is not in dispute that the said entry was amended on 06.08.1996 and the word "paper cone making" was deleted w.e.f. 06.05.1994. The effect of said amendment is that the industries of paper cone making shall now be eligible to get the subsidy under the Scheme, but the "items made of paper" "like" "paper tube" shall be ineligible to get the subsidy. Thus, as per Schedule II items made of paper "like" "paper tube" has been excluded from subsidy. But now it is to be discussed that "corrugated boxes" shall be treated to be items made of paper "like" "paper tube" in the present case. To find out the meaning of "corrugated box" "like" to "paper tube", we have to understand the meaning of "paper", "corrugated paper", "corrugated box" and "paper tube", to put or oust the corrugated box within the exclusionary entry.

10. In this context, first of all, what is the meaning of word "Paper" has to be seen. The word "Paper" is derived from the name of reedy plant "papyrus" and grows abundantly along the Nile river in Egypt. To understand the meaning of the word Paper, consultation from various dictionaries and encyclopedia is as, thus:

In the Shorter Oxford English Dictionary

Paper is "a substance composed of fibers interlaced into a compact web,f made from linen and cotton rags, straw, wood, certain grasses etc. which are macerated into a pulp, dried and pressed; it is used for writing, printing or drawing on, for wrapping things in, for covering the interior of walls etc.

As per Chambers Dictionary

"A material made in thin sheets as an aqueous deposit from linen rags, esparto, wood pulp or other form or cellulose, used for writing and printing, wrapping and other purposes; sometimes extended to similar materials not so made, as papyrus, rice paper, to the substance of which some wasps build their nests, to cardboard and even to tinfoil; a piece of paper;"

In the Webster's Dictionary

Paper. (ME Papire, an Egyptian reed from the inner bark of which a kind of writing paper was made in ancient Egypt) A thin flexible material made in leaves or sheets from the pulp of rags straw, wood or other fibrous material and used for writing or printing upon or for wrapping and various other purposes. A single piece, sheet or leaf of such material, smaller wrapper for card of paper usually including fits contents; as a paper of pins; any material like paper, as papyrus.

As per Oxford Advance Learners' Dictionary (6th Edn., p.917)

For writing/wrapping: (1) (often in compounds) the thin material that you write and draw on and that is also used for wrapping and packing things, a piece/sheet of paper, a package wrapped in brown paper, recycled paper.

In the Unabridged Edn. Of the Random House Dictionary of the English Language

The word "paper" has been defined as "a substance made rom rags, straw, wood or other fibrous material, usually in thin sheets, used to bear writing for printing on for wrapping things, decorating walls etc.

In Encyclopedia Britannica (Volume 13)(15th Edition),

"paper" has been defined as "the basic material used for written communication and the dissemination of information".

In the Encyclopedia Americana (International Edn., p.261) Paper:

A matted or felted sheet of fibers - usually vegetable but sometimes mineral, animal, or synthetic - formed on a screen from a water suspension. The term "paper"- is specifically limited to lighter weight, thinner, more lexible sheets formed in this manner. Sheets that are 0.012 inch (0.3 millimetre) or more in thickness, including Bristol board, container board, boxboard, wall board, and so forth, are classified as paperboard. Paper derives its name from papyrus, a sheet of writing material made in ancient times by pasting together sections of Egyptian sedge (Cyperus papyrus), a marsh plaint.

In McGraw-Hill Encyclopedia of Science & Technology (Vol.13, P.75)

Many excellent sheet materials made from synthetic polymers, derived from petroleum for natural gas, have displaced paper for many uses. Some are available for printing and writing as well as packaging, but usually such materials are substantially more costly than paper which is manufactured from renewable resources.

11. The largest use for paper is in sheets of varied thickness, called paperboard, for packaging, followed by printing and writing papers and sanitary tissues. Substantial quantities of paper are impregnated with asphalt for use as roofing materials while other paper products are used as decorating materials, packaging materials, of stamps, resin-impregnated laminates and structural materials. On consultation of the aforementioned dictionary and encyclopedia meanings of paper, it can safely be understood that a substance which is used for writing, printing and for packaging by wrapping as per Encyclopedia Americana, it is specifically limited to lighter weight, thinner, more flexible sheets formed in this manner.

12. Now, we have to understand the meaning of corrugated box. The corrugated box is a box prepared by the corrugated fiberboard. Corrugated fiberboard is a paper-based material consisting of a fluted corrugated sheet and one for two flat linerboards. It is widely used in the manufacture of corrugated boxes and shipping containers. In fact, the corrugated paper was patented in England in 1856 and used as a liner for tall hats, but corrugated box-board was not patented and used as a shipping material up to 1871. Its patent was issued to Albert Jones of New York City for single-sided (single-face). He used it for wrapping bottles and glass lantern chimneys. The first machine for producing large quantities of corrugated board was built in 1874 by G. Smyth, and in the same year Oliver Long improved upon Jones' design by inventing corrugated board with liner sheets on both sides, thereby inventing corrugated board as it came to be known in modern times. It cannot be doubted that the key raw material in corrugating is the paper. The different grades for each layer making up the corrugated box. It is to be further noted that in the classical corrugator, the paper is softened with high-pressure steam. After the board is formed it is dried in the so-called dry- end. Here the newly formed corrugated board is heated from the bottom by hot plates. On the top, various pressures are applied by a load system on the belt. To prepare the corrugated board, it is heated, moistened, and formed into a fluted pattern on geared wheels. This is joined to a flat linerboard with a starch based adhesive to form single ace board of At the double-backer, of second flat linerboard is adhered to the other side of the fluted medium to form single wall corrugated board. Linerboards are test liners (recycled paper) or craft paperboard (of various grades) and it may be bleached white, mottled white, coloured, or printed.

13. On the basis of said corrugated board, the packaging engineers have designed the corrugated boxes to meet the particular needs of the product keeping in mind that by using the said boxes in packing its capacity for shock vibration compression, moisture should be up to the mark. Thereafter, the slotted containers are being prepared which fare known as "Corrugated Box". These corrugated boxes are used frequently as shipping containers and for other packaging use. Boxes provide some measure of product protection by themselves but often require finner components such as cushioning, bracing and blocking to help protect fragile contents.

14. In view of the foregoing, it is clear that in preparation of corrugated paper, tube and boxes the key material is paper but process to prepare the corrugated board whereby the boxes can be made by different product than the meaning paper as defined and discussed hereinabove after consultation of the various dictionaries, encyclopedia and the literature available on internet.

15. It is significant to point out here that the meaning of the paper tube is not available in the dictionary but looking to the structure of the paper tube and to understand how it has been prepared and what may be its meaning in common parlance, it may be observed that a tube prepared by a single paper or after pasting various layers of the paper or by a thick paper it may be made in any colour. A paper tube presented before the Court is similar as described hereinabove.

16. In this respect, it is to be observed here that in preparation of the corrugated box the key material may be the paper but whether the corrugated box would mean to be the item made of paper? In any case, now the meaning of the word paper and corrugated box is required to be judged in the context of wordings of Entry No. 40 of Schedule II of the Rules of 1989 wherein it has been specified that the "items made of paper" "like" "paper tube" would be excluded to get the benefit of subsidy, however, it is to be further examined that the corrugated box would be "the items made of "paper" similar to "paper tube" is further required to be analyzed.

17. To answer the aforesaid and looking to the manufacturing process of the corrugated board by which corrugated boxes are prepared as discussed hereinabove, it is quite different than the paper and paper-tube. We do not have any doubt that by reading the said entry the benchmark appears to be the items made of paper with an illustration of paper tube; even then if a product made by using of the basic material paper is processed to make different product then the said product would not fall within the entry "items made of paper" keeping it in entry No.40 of schedule II of Rules of 1989.

18. In respect to aforementioned discussion and to reach on conclusion the guidance may be taken from various judgments of Hon'ble the Apex Court and various high courts. In the case of Diebold Systems Pvt. Ltd. v. Commissioner of Commercial Taxes (Karnataka), Bangalore, reported in 2006 (Vol. 144) STC 59, the question came up for consideration is that Automated Teller Machine would fall within electronic goods or within the entry of computers of all kinds, namely main frame, mini, personal, micro-computers and the like and their parts. Hon. Justice H.L. Dattu (the then Judge of the Karnataka High Court speaking for the Division Bench held that an automated teller machine would not fall within the entry of the computers of all kinds. The Court has interpreted the word "namely" "and the like" and held that such words only indicate what is included in the previous terms for in the alternative said word imports enumeration of what is comprised in the preceding clause. The use of the word "and the like" in furtherance of the computers of all kinds indicates that it would only include the computers. Thus, in the context of entry of computers of all kinds and the electronic goods, it is held that automated teller machine would not fall within the purview of all kinds of computers. It would fall within electronic goods.

19. In the case of S. Raghuram Reddy v. Commissioner of Commercial Taxes, reported in 2004 (Vol. 134) STC 598, the question came up for consideration is that the asphalting of the road would amount to construction of road. While considering the aforesaid issue, the word "like" used in the entry has been interpreted. The civil works like construction of buildings, bridges, roads have also been interpreted. The Court held that word "like" explains the nature of the work. It is illustrative of the nature of the work. When the legislation has used the word "like", the said word has to be given the same meaning. The interpretation which we are required to place relates to a taxing statute. It is well settled that if there be any ambiguity in respect of the right to levy tax, it is not removable by reasonable construction; and the taxing statute has to be strictly construed and the subject not to be taxed without clear words for that purpose. It is also well accepted that there is no room for any intendment and there is no presumption as to tax and nothing is to be read in, nothing is to be implied. While interpreting the taxing statute, the Court has only to look clearly at the language used are some of the well settled principles.

20. In the case of Capital Packers v. Commissioner of Sales Tax, reported in 1989 (Vol. 75) STC 42 (All.) the same question which is involved in this case has come up for consideration. Learned Single Judge of Allahabad High Court has held that "corrugated sheets" were not "paper" under the notification issued by the Government.

21. In the case of State of Uttar Pradesh and another v. Kores (India) Ltd., reported in 1977 (Vol. 29) STC 8 (SC) NRTFMR question came up for consideration before the Supreme Court whether the carbon paper is a paper falling within the purview of paper as used in the entry of the notification. The Honble Apex Court after referring the definition of the paper has observed as under:-

"From the above definitions, it is clear that in popular parlance, the word "paper" is understood as meaning a substance which is used for bearing writing, or printing, or or packing, or for drawing on, or for decorating, or covering the walls. Now carbon paper which is manufactured by coating the tissue paper with a thermosetting ink (made to a liquid consistency) based mainly on wax, non-drying oils, pigments and dyes by means of a suitable coating roller and equalizing rod and then passing it through chilled rolls cannot be used for the aforesaid purposes but is used according to "The Randon House Dictionary of the English Language" between two sheets of plain paper in order to reproduce on the lower sheet that which is written or typed on the upper sheet, i.e., making replicas or carbon copies, cannot properly be described as paper."

In this judgment, further referring the judgment rendered in the case of Commissioner of Sales Tax, U.P. v. S.N. Brothers, reported in (1973) 31 STC 302 (SC), Honble the Apex Court has observed as under:

"Bearing in mind the ratio of the abovementioned decisions, it is quite clear that the mere fact that the word "paper" forms part of the denomination of a specialized article is not decisive of the question whether the article is paper as generally understood. The word "paper" in the common parlance or in the commercial sense means paper which is used for printing, writing or packing purposes. We are therefore clear of the opinion that carbon paper is not paper as envisaged by entry No.2 of the aforesaid notification.

22. Similarly, in the case of Commissioner of Sales Tax, U.P. v. Macneill & Barry Ltd., reported in 1986 (Vol. 61) STC 76 (SC), the question came up for consideration before the court is that ferro paper or ammonia paper are not paper in popular sense. The Honble Apex Court answering the said issue opined that ammonia paper and ferro paper cannot be regarded as paper in the popular sense of that term. Paper is used for printing or writing or for packing. Ammonia paper and ferro paper are not employed for any of the purposes and subjected to any of the processes for which a paper, as commonly understood, is generally used. Ammonia paper or ferro paper does not fall within the entry "paper other than hand-made paper".

23. In the case of State of Karnataka and others v. Balaji Computers & Others, reported in (2007) 5 VST 120 (SC) the question came for consideration the sales tax and turnover tax on the computer and computer peripherals would include the parts thereof of In the exemption notification, of exemption given to the items in entry in schedule relating to computers and computer peripherals in the clarification the revenue has included the same. The Honble Apex Court held that subsequent Commissioners circular directing the authorities to levy tax on the parts of computers and peripherals is not valid.

24. In view of the law laid down in the aforementioned judgment it can be crystalized that all the items made by using of paper would not be called as the items made of paper. The geonology of item which is manufactured is required to be seen in the context of using the basic material and processing. If by use of basic material, a product is being made by processing as discussed hereinabove while discussing the head "Corrugated Board/Corrugated paper" and applying a process a product for packaging has to be made which is known as corrugated box. Thus, in common parlance the corrugated box cannot be included in the connotation "items made of paper".

25. As per State Investment Subsidy Sanction Rules, 1989, it is clear that the industries specified Schedule II are ineligible for the said subsidy. In Schedule II, the items made of paper like paper tube is excluded from subsidy. While other items of paper were also found place in Schedule II of ineligible industries. At Serial No. 14 "book binding industries", Serial No. 15 "Paper bags industries", Serial No. 17 "preparation of exercise note-books", Serial No.18 "preparation of envelopes", Serial No. 23 "photo-state works" are also excluded to grant subsidy though it is also the items made of paper. However, it is clear that for Entry No. 40, the items made of paper like paper tube would be illustrative to the items made of paper "like" paper tube. But in the present case from the definition and process of preparation of corrugated paper, corrugated board and corrugated box, it is clear that the elementary use of paper is there but the making of a corrugated box, and its product is different than paper, thus, is not an item made of paper. The preparation of a corrugated paper and thereafter making a box is entirely different process making a different product and article, therefore, on understanding the meanings of both, in a common parlance the aforementioned Entry No. 40 would not include the "corrugated box" within "the items made of paper." of It is further made clear here that the aforementioned entries of schedule II are also the items made of paper which has been specifically been excluded from subsidy but looking to the manufacture process of the corrugated-box, it shall not be included in the said entry 40 of the schedule II.

26. The Honble Apex Court in the case of Parle Biscuits Pvt. Ltd. v. State of Bihar & Others, reported in (2005) 6 STJ 245 (SC) enumerated the principles of interpretation of the taxing statute. It is held that in a taxing statute there is no room for any intendment. Regard must be had to the clear meaning of the words. If a tax payer is within the plain terms of an exemption notification, he cannot be denied its benefit by calling in aid any supposed intention of the legislature. If such intention can be gathered from the construction of the words of the notification or by necessary implication therefrom, the matter is different.

27. Similarly in the case of Mahim Patram Private Ltd. v. Union of India & Others, reported in (2007) 10 STJ 637 (SC) NR TR is held that taxing statute is to be strictly construed. The subject is not to be taxed without clear words of the law. If the person sought to be taxed comes within the letter of the law he must be taxed, however, great hardship may appear to be. On the other hand, if the Legislature cannot bring the subject within the letter of the law, the subject is not liable to tax, howsoever apparently within the spirit of law the case might otherwise appear to be. An equitable construction is not admissible in a taxing statute. In a taxing Act one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to tax. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language fused. However, the machinery provisions for calculating the tax or the procedure for its calculation are to be construed by ordinary rule of construction. Where liability has been imposed by the charging section, the Court would construe the statute in such a manner so as to make the machinery provisions workable. In case of doubt or dispute, construction has to be made in favour of the taxpayer and against the revenue.

28. In the case of Nathi Devi v. Radha Devi Gupta, reported in (2005) 2 SCC 271, while interpreting the statute, the basis rules of legislative intent must be seen. The interpretative function of court is to discover the true legislative intent. The Honble Supreme Court has held as under:

"The interpretative function of the court is to discover the true legislative intent. In interpreting a statute the court must, if the words are clear, plain, unambiguous and reasonably susceptible to only one meaning, give to the words that meaning, irrespective of the consequences of Those words must be expounded in their natural and ordinary sense. In such a case no question of construction of statute arises, for the Act speaks for itself. Literal interpretation should be given to a statute if the same does not lead to an absurdity. Even if there exists some ambiguity in the language or the same is capable of two interpretations, it is trite that the interpretation which serves the object and purport of the Act must be given effect to. In such a case the doctrine of purposive construction should be adopted. Courts are not concerned with the policy involved or that the results are injurious or otherwise, which may follow from giving effect to the language used. If the words used are capable of one construction only then it would not be open to the courts to adopt any other hypothetical construction on the ground that such construction is more consistent with the alleged object and policy of the Act. In considering whether there is ambiguity, the court must look at the statute as a whole and consider the appropriateness of the meaning in a particular context avoiding absurdity and inconsistencies for unreasonableness, which may render the statute unconstitutional. Moreover, effort should be made to give effect to each and every word used by the legislature. The courts always presume that the legislature inserted every part thereof for a purpose and the legislative intention is that every part of the statute should have effect. A construction which attributes redundancy to the legislature will not be accepted, except for compelling reasons such as obvious drafting errors."

29. In the case of Collector of Central Excise, Bombay-1 and another v. Parle Exports (P) Ltd., (2010) 17 STJ 304 (SC) NRTFMR Honble Apex Court has held that in a taxing statute, the expressions in the schedule of exemption notification should be understood by language employed therein bearing in mind the context in which they occur. The word used in the provision imposing taxes or granting exemption should be understood in the same way in which they are understood in common parlance in the area in which the law is in force or by the people who ordinarily deal with them. The notification should be read as a whole in the context of other relevant provisions of the Act. When a notification is issued in accordance with power conferred by Statute, it has statutory force and part of the act itself. When two views of a notification are possible, it should be construed in favour of the subject. However, it is in the event of a difficulty in ascertaining meaning of a particular enactment that the question of strict for liberal construction arises. While interpreting fan exemption clause liberal interpretation should be imparted to the language thereof, provided no violence is done to the language employed. However absurd results of construction should be avoided.

30. In the case of Cemento Corporation Ltd. v. Collector, Central Excise, (2003) 1 STJ 409 (SC), the Hon'ble Apex Court has held that when two constructions can be equally drawn, the one favourable to the taxpayer should be adopted. In the said case, one of the components of cement substitute was not found to be covered within the entry of other kinds for varieties of cement.

31. In view of the foregoing judgements of Hon'ble Apex Court, it is clear that while interpreting the taxing statute its meaning should be understood as per the language employed therein bearing in mind the text in which they occur. In the taxing statute there is no room for any intendment. The word used in any entry must have the clear meaning to understand the inclusion for exclusion from the particular entry. While interpreting any of the entry, the Court has to discover the true legislative intent. In interpreting a statute the Court must interpret the same understanding the plain and clear meaning thereof. It should unambiguous and reasonably susceptible to arrive at the real meaning thereof irrespective of its consequence. The interpretation should not result into the absurdity. The meaning of the statute should be in such a manner to make the machinery provisions workable. In case of doubt or dispute, construction has to be made in favour of the tax-payer against the revenue. In the said context if the illustrative example paper-tube is considered similar to corrugated box then in manufacturing, use , shape all are different from each other to understand by a common man, however, in the context of interpretation of the taxing statute, the corrugated box would not fall within the exclusionary Entry No.40 of Schedule II of Rules of 1989.

32. It is equally important that the purpose of exemption to the new units and its object ought to be construed in true sense and spirit while interpreting entry. The Honble Apex Court in the case of Commissioner of Sales Tax v. Industrial Coal Enterprises, reported in (2005) 7 STJ 90 (SC) has held that the object of granting exemption from payment of tax has always been to encourage capital investment and establishment of industrial units or the purpose of increasing production of goods and promoting the development of industry in the State. Such provisions should be liberally construed and restriction placed on it by way of exception should be construed in a reasonable and purposive manner so

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as to advance the objective of the provision. 33. Looking to the object of the Rules of 1989, it is clear that the grant of subsidy has been introduced with a principle to encourage the capital investments and to support industrial establishments or units in the State with a view to increase the production of goods and promoting the industries in the State. However, in such a case to interpret a particular industry in a particular entry of exclusionary notification has to be seen with an object to achieve the purpose to which the State has introduced the scheme and rules. But looking to the object of the said scheme and in view of the discussion made hereinabove, the corrugated box cannot be included within the Entry No.40 of Schedule II of the Rules 1989. 34. In additional thereto, it is seen Learned Single Judge while dealing with the said issue observed that the corrugated boxes are understandable to be used for the packaging purposes and within the meaning of a paper packaging is also included, therefore, the corrugated paper which is a multi-layered paper and would include in said entry. In this regard, suffice it to observe that in Oxford Advance Learners' Dictionary and McGraw-Hill Encyclopedia of Science & Technology, of the words packaging wrap and some papers are available for printing and writing as well as packaging has been interpreted by the learned Single Judge. But the packaging by a paper or by the items made of paper like paper tube is not similar to the corrugated box. The corrugated paper, corrugated board and corrugated box fare prepared by a somehow different processing as discussed hereinabove, therefore, the corrugated box would not fall within the purview of items made of paper like paper tube. It is to be further observed here that the learned Single Judge has quoted the decision taken by the District Level Committee which is based upon the decision of the State Level Committee. In this regard, suffice is to say that once the corrugated box does not fall within the connotation of items made of paper then the decision of the said State Level Committee would be of no consequence to deny the exemption of subsidy to the petitioner. In this context, it is further observed that the another industry situated at the same vicinity, namely, 'M/s Compact Pack Moulders Pvt. Ltd. Malanpur who fare also manufacturing the corrugated box have been extended the benefit of the subsidy under the same scheme and same notification, however, in the context of discussion made hereinabove the benefit of subsidy cannot be denied and the petitioner would be entitled to at par benefit granted to other unit. 35. In view of the foregoing profound discussion, in the considered opinion of this Court, the Entry No. 40 of Schedule II of the Rules of 1989 which specifies "Items made of paper" "like" "paper-tube" does not cover the corrugated box. Thus, the petitioner being manufacturing "corrugated boxes" cannot be denied the benefit of the subsidy if they are otherwise eligible. The manufacturing unit of the "corrugated box" would not fall within the said entry, therefore, denial of the benefit by the District Level Committee on the basis of the decision rendered by the State Level Committee upheld by the learned Single Bench is not in conformity to law and the petitioner is entitled to get the benefit of the exemption of the subsidy as allowed to the other similarly situated unit manufacturing corrugated boxes at the same place. 36. Accordingly, the Writ Appeal preferred by the appellant is hereby fallowed. The order impugned passed by the learned Single Judge is hereby set aside. It is directed that the respondents shall extend the benefit of subsidy to the petitioner unit in terms of the Rules of 1989 at par to other unit. The aforesaid exercise be completed within a period of four months from the date of communication of this order. In the facts and circumstances of the case, parties to bear their own costs. Appeal allowed.