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Judgment
Alok Aradhe, J.—The petitioner in instant writ petition has challenged the validity of circular dated 27.1.2007 (Annexure P-1) issued by Commissioner, Commercial Tax, M.P. by which instructions have been issued to assessing officers in the State of M.P. to the effect that mobile handset is a type of wireless reception instrument and apparatus and, therefore, would fall within entry 49 of Schedule II of the M.P. Sthaniya Kshetra Me Mal Ke Pravesh Par Kar Adhiniyam, 1976 (hereinafter referred to as ''the Act''). The petitioner has also assailed the validity of the order of assessment dated 25.6.2007 (Annexure P-2) and order dated 29.4.2008 (Annexure P-4) passed in revision by the Additional Commissioner, Commercial Tax by which the order of assessing authority has been upheld.
Facts giving rise to filing of the instant petition, briefly stated, are that the petitioner is a dealer and imports cellular phones from outside the country. The petitioner filed the return claiming the tax payable as nil, on the ground that goods i.e. mobile handset is covered by entry 1 of Schedule III of the M.P. Commercial Tax Act, 1994. The Commissioner, Commercial Tax, M.P. issued a circular dated 27.1.2007 instructing all the assessing officers that entry tax is not being charged on mobile handsets treating them as covered under entry 1 of Schedule III, whereas the mobile handsets are only a kind of wireless reception instrument and apparatus and, therefore, are covered by entry 49 of Schedule II and taxable at the rate of 1%. Accordingly, all assessing officers were directed to examine the cases afresh to see whether the entry tax has been levied on such goods or not and to take appropriate action.
The respondent No.4 on the basis of the aforesaid circular assessed the petitioner to entry tax for a period from 20.12.2004 to 31.3.2005. The assessing officer vide order dated 25.6.2007 (Annexure P-2) held that mobile handset is also a kind of wireless reception instrument and apparatus and, therefore, the same is covered under entry 49 of Schedule II of M.P. Commercial Tax Act, 1994. Being aggrieved by the aforesaid order of assessment the petitioner preferred a revision before Additional Commissioner of Commercial Tax. However, Additional Commissioner vide order dated 29.4.2008 (Annexure P-4) affirmed the order passed by assessing officer.
The question which arises for consideration in the instant writ petition is whether the mobile handset would fall under entry 1 of Schedule III or entry 49 or entry 53 of the Schedule II of the M.P. Commercial Tax Act, 1994 so as to attract the levy of tax at the rate of 1% under the Act.
Shri H.S. Shrivastava, learned senior counsel for the petitioner submitted that mobile handset cannot be held to be covered under entry 49 of Schedule II and cannot be treated as wireless reception instrument and apparatus. Our attention was drawn to the distinction between wireless reception instrument and cellular phone while referring to the written submission filed before the revisional authority. It has been argued that wireless reception instrument can be operated without sim, whereas in order to operate cellular phone, a sim has to be inserted in the handset. The entry with regard to wireless reception instrument was incorporated in the statute, when the mobile was not in use 15 to 20 years ago whereas cellular phone has been introduced just 7 to 8 years ago. Learned senior counsel has submitted that entries in taxing statute have to be given their common parlance meaning. For the aforesaid proposition he has placed reliance on decisions reported in Madhya Pradesh Pan Merchants Association, Santra Market. Nagpur v. The State of Madhya Pradesh, 7 S.T.C. 99 Madhya Pradesh Pan Merchants Association, Santra Market. Nagpur v. The State of Madhya Pradesh, 7 S.T.C. 99 . It is also submitted that entries 49 and 53 of List II existed on the statute book since 1999 however, from 1999 till 2007 assessing officers in the State of M.P. have been treating mobile handset as falling under Schedule III. Even Commissioner in his circular does not mention that mobile handsets fall under entry 53 of Schedule II. It was also pointed out that circular dated 27.1.2007 has been issued by the Commissioner, Commercial Tax in exercise of powers u/s 70 of the M.P. VAT Act, 2002. It is further submitted that the assessing officer is a quasi judicial authority and cannot pass an order of assessment on the basis of dictates of a superior officer. The order of assessment as well as order passed in revision are perverse, arbitrary and are bad in law.
On the other hand, Shri Kumaresh Pathak, learned Deputy Advocate General has submitted that that entry 49 in Schedule II of M.P. Commercial Tax Act, 1994 is wide enough to include mobile handset, alternatively, it would fall under entry 53 being electronic and electrical goods. It has been further submitted that rate of tax under both the entries i.e. entry 49 and entry 53 is the same.
At this stage, it would be appropriate to reproduce the relevant entry:
Wireless reception instruments and apparatus radios & radio gramophone, television, VCR, VCP, tape recorders, transistors and parts and accessories thereof.
It is well settled rule of statutory interpretation that the Court is free to apply current meaning of statute to present day conditions. [See: State through CBI Vs. S.J. Choudhary, , The State of Maharashtra and P.C. Singh Vs. Dr. Praful B. Desai and Another, and Rabindra Singh Vs. Financial Commissioner, Coopration, Punjab and Others, It is equally well settled in law that general words are construed to include new inventions and technological advantages not known at the time when the Act was passed. It has accordingly been held that telephone is telegraph within the meaning of that word in Telegraphs Act, 1863 and 1869 although telephone was not invented in 1869 (See: The Senior Electric Inspector and Others Vs. Laxmi Narayan Chopra and Others, and Vishnu Agencies (Pvt.) Ltd. Vs. Commercial Tax Officer and Others, . Following the same principle it has been held by Supreme Court in M/s. Laxmi Video Theaters and Others Vs. State of Haryana and Others, that definition of cinematograph'' contained in Section 2(e) of the Cinematograph Act, 1952 and in Cinema Regulation Acts enacted by the States in 1952 will cover video cassette recorders/players developed in 1970s for representation of motion pictures on a television screen. [See principles of Statutory Interpretation by Justice G.P. Singh, 12th Edition 2010, pg. 254-255] We may also refer to following relevant extract from page 257 of the aforesaid book:
When a comparatively modern device and equipment was becoming in vogue at the time when the Act was enacted, there can be no difficulty in holding that general words used in the Act will cover such device and equipment. Thus ''notice in writing'' required by Section 138 of the Negotiable Instrument Act, 1881, which was inserted in 1968 when Facsimile (Fax) had become (sic come in) vogue was held to include notice transmitted by Fax.
In Tata Teleservices Ltd. Vs. Bharat Sanchar Nigam Ltd. and Others, the Supreme Court had an occasion to deal with the issue namely - a fixed service provided through wireless local loop, whose operation was not confined to subscriber''s premises, could be treated as Mobile service. It was held that since services provided through" Walky" extended beyond the subscribers premises, it was a mobile service. It was further held that wireless is a term used to describe telecommunications in which electromagnetic waves carry the signal over the communication path. It has further been held that the common examples of wireless equipments in use today include cellular phone, pagers, global positioning of system, cordless telephone sets, etc. In view of the aforesaid enunciation of law by Supreme Court and in view of the fact that a comparative modern device and equipment namely mobile handset was coming in vogue at the time when the M.P. Commercial Tax Act, 1994 was enacted, there is no difficulty in holding that general words used in entry 49 (wireless reception instruments and apparatus) would cover mobile handsets. In view of the preceding analysis, we hold that mobile handsets are covered under entry 49 of Schedule II of M.P. Commercial Tax Act, 1994 and excisable to levy for entry tax at the rate of 1 %. For the aforementioned, reasons the contention raised by learned senior counsel that entries have to be given their common parlance meaning and, therefore, the mobile handsets cannot be treated as wireless reception instruments and apparatus, does not deserve acceptance.
So far as contention of learned senior counsel for the petitioner with regard to circular dated 27.1.2007 is concerned, in this context, we may reproduce relevant extract of Section 70 of the M.P. VAT Act, 2002 :
Determination of disputed questions. - (1) The Commissioner, -
(i) either on his own motion on any question in respect of the rate of tax on any goods may, at any time; or
(ii) if any question is raised by a dealer in respect of the rate of tax on any goods shall, within six months from the date of receipt of the application made by the dealer for this purpose in the prescribed manner and on payment of such fee as may be prescribed.
Thus from perusal of sub-section (1) of Section 70 it is apparent that Commissioner either on his own motion on any question in respect of the rate of tax on any goods or if any question is raised by dealer in respect of the rate of tax on any goods, shall within six months from the date of receipt of the application made by dealer, make an order determining the rate of tax on such goods. Thus, u/s 70 of the M.P. VAT Act, 2002 the Commissioner has power to make an order determining the rate of tax. From perusal of circular dated 27.1.2007 it is apparent that it has not been issued because there was some dispute with regard to rate of tax on goods in question. Therefore, the contention of learned senior counsel that circular dated 27.1.2007 has been issued u/s 70 of the M.P. VAT Act, 2002 cannot be accepted. For yet another reason, the aforesaid contention cannot be accepted, because the rate of tax under entry 49 as well as entry 53 is the same. Even assuming for the sake of argument that mobile handsets cannot be treated as wireless reception instruments and apparatus then also it would be covered under expression electronic and electrical goods under entry 53 of List II of the Act and the rate of tax under both the entries is the same.
For the aforesaid reasons, we do not find any merit in the instant writ petition. Accordingly the same is dismissed. However there shall be no order as to costs.