# STATE OF UTTAR PRADESH v. M/S. KORES (INDIA) LTD

- **Citation:** [1977] 1 S.C.R. 837
- **Court:** Supreme Court of India
- **Decided:** 1976-10-18
- **Bench:** H. R. Khanna, Jaswant Singh
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/state-of-uttar-pradesh-v-m-s-kores-india-ltd-6983
- **Pages:** 5

## Headnote

U.p, Sales Tl!fx Act, 1948, s. 3-A, Notification issued under-Rule for constructing words-W/zetlzer carbon paper is taxable as 'Paper'-Whetlzer ribbon is
accessof'y or part of typewriter.
The Governor of U. P. issued a Notification under Section 3-A of the U.P.
Sales Tax Act/ 1948, and the Sales Tax Officer (Section IV) Kanpnr, ordered the
respondent company to pay tax on the turnover of carbon paper at 6%, and that
A
B
of ribbon at 10%, as per entry 2 of the Notification.· The respondent challenged
C
the order in a :writ petition before the High Court. contending that carbon paper
was not 'paper' with the meaning of entry 2 and its turnover was therefore to
be assessed at the rate of 2% prescribed for unclassified goods, and that 'ribbon'
being an accessory and not a part of -the typewriter, could only be taxed at the
rate of 6 % and. not l 0%. The High Court allowed: the writ and Quashed the
levy.
The appellant contended that carbon paper does not lose its character as
!Japer in spite of being subjected to chemical processes, and that ribbon is not an
D
accessory but an essential part of the typewriter.
Dismissing thCI appeal the Court,
HELD :: (1) A word which is not defined in an enactment has to be understood in its popular and commercial sense with reference to the context in which
it occurs. It has to be understood according to the well established canon of construction in th~ sense in, which persons dealing in and using the article understand
it. [839' A-Bl
Allol'lley General v. Winstanley (1831) 2 Dow & Clark 302==(1901) 6 E.R.
740, and Grenfell v. Commissioner of Inland Re1·e11ue (1876) l Ex. D. 242 at
p. 248 applied.
E
(2) The word 'paper· is understood as meaning a substance which is used for
bearing writing or printing, or for packing, or for drawing on, or for decoraling,
or covering the walls. Carbon paper cannot be used for these purposes but is used
for making replicas or carbon copies, and cannot i:roperly be described as paper,
[839 G, 840 A-Bl
F
K. Ki/bul'll & Co. Ltd. v. Commissioner of Sales Tax, U.P.
Lucknow
(31
S.T.C. 625), Sree Rama Trading Company v. State of Kera/a (28 S.T.C. 469),
State of Orissa v. Gestetner Duplicators (P) Ltd. (33 S.T.C. 333) Commissioner
of Sales Tax, U.P. v. S. N. Brothers (31 S.T.C. 302) applied.
(3) The above mentioned rule of construction equally applies to ribbon. It
i·s an al:Cessory and 110t a part of the typewriter, though it may not be possible
t..o type out any matter without it. [841 D-E]
'I
State of' Mysore v. Kores (India) Ltd. (26 S.T.C. 87) approved.

## Text

837
STATE OF UTTAR PRADESH
v.
M/S. KORES (INDIA) LTD.
October 18, 1976
[H. R. KHANNA AND JASWANT SINGH, JJ.]
U.p, Sales Tl!fx Act, 1948, s. 3-A, Notification issued under-Rule for constructing words-W/zetlzer carbon paper is taxable as 'Paper'-Whetlzer ribbon is
accessof'y or part of typewriter.
The Governor of U. P. issued a Notification under Section 3-A of the U.P.
Sales Tax Act/ 1948, and the Sales Tax Officer (Section IV) Kanpnr, ordered the
respondent company to pay tax on the turnover of carbon paper at 6%, and that
A
B
of ribbon at 10%, as per entry 2 of the Notification.· The respondent challenged
C
the order in a :writ petition before the High Court. contending that carbon paper
was not 'paper' with the meaning of entry 2 and its turnover was therefore to
be assessed at the rate of 2% prescribed for unclassified goods, and that 'ribbon'
being an accessory and not a part of -the typewriter, could only be taxed at the
rate of 6 % and. not l 0%. The High Court allowed: the writ and Quashed the
levy.
The appellant contended that carbon paper does not lose its character as
!Japer in spite of being subjected to chemical processes, and that ribbon is not an
D
accessory but an essential part of the typewriter.
Dismissing thCI appeal the Court,
HELD :: (1) A word which is not defined in an enactment has to be understood in its popular and commercial sense with reference to the context in which
it occurs. It has to be understood according to the well established canon of construction in th~ sense in, which persons dealing in and using the article understand
it. [839' A-Bl
Allol'lley General v. Winstanley (1831) 2 Dow & Clark 302==(1901) 6 E.R.
740, and Grenfell v. Commissioner of Inland Re1·e11ue (1876) l Ex. D. 242 at
p. 248 applied.
E
(2) The word 'paper· is understood as meaning a substance which is used for
bearing writing or printing, or for packing, or for drawing on, or for decoraling,
or covering the walls. Carbon paper cannot be used for these purposes but is used
for making replicas or carbon copies, and cannot i:roperly be described as paper,
[839 G, 840 A-Bl
F
K. Ki/bul'll & Co. Ltd. v. Commissioner of Sales Tax, U.P.
Lucknow
(31
S.T.C. 625), Sree Rama Trading Company v. State of Kera/a (28 S.T.C. 469),
State of Orissa v. Gestetner Duplicators (P) Ltd. (33 S.T.C. 333) Commissioner
of Sales Tax, U.P. v. S. N. Brothers (31 S.T.C. 302) applied.
(3) The above mentioned rule of construction equally applies to ribbon. It
i·s an al:Cessory and 110t a part of the typewriter, though it may not be possible
t..o type out any matter without it. [841 D-E]
'I
State of' Mysore v. Kores (India) Ltd. (26 S.T.C. 87) approved.
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
1773
of
19'71.
(From the Judgment and order dated 20-2-1970 of the Allahabad
High Court in Civil Misc. Writ Petition No. 2943/69)
•
G
S. C. Manchanda and 0. P. Rana, for the Appellants.
H
V. S. Desai, P. B. Agarwala and B. R. Agarwala, for the Respondents.
A
B
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D
E
F
G
H
838
SUPREME COURT REPORTS
LI 97'1] 1 S.C.R.
The Judgment of the Court was delivered by
JASWANT SINGH, J.-This appeal by certificate which is directed
against 0e judgment and _order elated February 20, 1970, passed
by the High Court of Judicature at Allahabad in writ petition No.
2943 of 1969 raises two interesting questions viz. (1) whether carbon
paper is paper falling within the purview of the word 'paper' as used
in serial No. 2 of Notification N:o. ST-3124/X-1012(4)-1964 dated
July 1, 1966, issued by the Governor of Uttar Pradesh in exercise
of the power vested in him under section 3-A of the u.-e. _Sales
fax Act, 1948 (U.P. Act No. XV of 1948) so as to be liaole to
sales tax at the point and at the rate specified in the Schedule to tl1e
Notification and (2) whether ribbon is an accessory or a rent of the
typewriter.
It appears that the respondent which is a company incorporated
under the Indian Companies Act dealing in carbon
paper,
typewriter, ribbon, stepler machines and stepler pins, despatches
the
said goods from its head office at Bombay to its branch office at
Kanpur wherefrom sales thereof are effected in the State of Uttar
Pradesh.
During the course of the assessment proceedings for the
assessment year 1956-57, the respondent claimed that carbon paper
not being paper falling within the ambit of Entry No. 2
of
the
Schedule to the aforesaid Notification but a specialised article used
for copying purposes, its turnover had . to be assessed at the rate of
2 per cent prescribed for unclassified goods and not at the rate of
6 paise per rupee i.e. 6% prescribed in the aforesaid Notification.
The respondent further claimed that ribbon being an accessory and
not a part of the typewriter, its turnover could not be subjected to
sales tax at the rate of 10% prescribed inter alia for typewriters
and parts thereof by Notification No. ST-1738/X-1012-1963 dated
June 1, 1963.
The Sales Tax Officer, (Section IV), Kanpur, did
not accede to the contentions of the respondent and holding that
carbon paper remained paper even after
going
through
certain
chemical processes and that ribbon was a part of the typewriter,
taxed the turnover of carbon paper for the period commencing from
July 1, 1966, to the end of March, 1967 at 6% and that of ribbon
at 10%. He, however, taxed the turnover of carbon paper for the
period April 1, 1966 to June 30, 1966 at 2%. The validity and
correctness of this order in so far as it related to the levy of tax
Oil carbon paper at 6% and ribbon at 10% was challenged by the
respondent by means of the aforesaid writ petition before the High
Court at Allahabad which by its aforesaid judgment
and order
allowed the same and quashed the levy.
Hence this appeal.
Appearing in support of the appeal, Mr. Manchanda has assailed
the reasoni11g and approach of the High Court and has vehemently
urged that carbon paper does not lose its character as paper even
after being subjected to chemical processes and that ribbon is not
an accessory but an essential part of the
typewriter.
We
have
carefully considered the submission made by Mr. Manchanda but
find ourselves unable to accept the same.
\_
. (-
I
L:. P. 1'. KORES (lNDlA) LTD. (Jaswant Si11gh J.).
839
It is well settled that a word which is not defined in an enactment
has to be understood in its popular and commercial sense with reference to the context in which it occurs.
In Attorney-General v. Winstanley ( 1), Lord Tenterdcn started as
follows :
. ..
"Now, when we look at the words of an Act of ParliaB
ment, which are not applied to any particular science or
art, we arc to construe them as they are understood in
common language."
£11•Gre111ell v. Commissioners of Inland Revenue (2) Pollock, J.
pointed out :
•'As to the construction of the Stamp Act, I think it was
very properly urged that the statute is not to be construed
according to the strict or technical meaning of the language
contained in it, but that it is to be construed in its popular
sense, meaning, of course, by the words 'popular sense' that
sense which people conversant with the subject-matter with
which the statute is dealing would attribute to it."
The wont 'paper' admittedly not having been defined either in
the U.P. Sales Tax Act, 1948 or the Rules made thereunder, it
has to be understood according t0 the aforesaid well
established
canon of construction in the sense in which persons dealing in and
using the article understand it.
It is, therefore, necessary to know
what is paper as commonly or generally
understood.
The
said
word which is derived from the name of reedy plant papyrus and
grows abundantly along the Nile river in Egypt is explained in 'The
Shorter Oxford English Dictionaiy (Volume 2) (Third Edition) l!_S
"a substance composed of fibres interlaced into a compact web, made
from linen and cotton rags, straw, wood, certain grasses, etc., which
are macrated 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."
In 'Encyclopaedia Britannica',
(Volume 13),
(15th Edition),
'paper' has been defined as the basic material used for written communication and the dissemination of information."
In the Unabridged Edition of "The Randon House Dicitionary of
the English Lan~age'', the word 'paper' has been defined as "a substance made from 0 rags, straw wood' or other fibrous material, usually
in thin sheets, used to bear writing or printing or for wrapping things,
decorating walls etc."
From the above definitions, it is clear that in popular parlance, the
word 'paper' is understood: as meaning !\. substance which is used for
bearing, writing, or printing, or for packing, or for drawing on, or for
~".Corating, or_.c<>_~!ing the walls.
Now carbon paper which is manu-
(1) [183112 Dow & Clark 302=(1901) 6 E.R. 740.
(2) [1876] 1 Ex.D. 242 at 248.
c
D
F
G
H
A
B
c
D
F
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840
SUPREME COURT REPORTS
[1977] 1 S.C.R.
factured by coat'11g the tissue paper with a thermo-setting ink (mack
to a liquid consistency) based mainly on wax, non drying oils, pigments and dyes by means of a suitable coating roller and equalising
rod and then passing it through chilled rolls cannot be -used for
the
aforesaid purposes)mt is us~ 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.
It will be well at this stage to refer to a few decisions whir.Ji confmn our view.
In Kilburn & Co. Ltd.
v.
Commissioner of Sales Ttx U.P.,
Lucknow(!) a Bench of Allahabad High Court while examining the
very same entry in the Notification with which we are concerned in
the instant case and holding that "Ammonia paper and ferro paper
used for obtaining prints and sketches of site plans are not paper as
understood generally and, therefore, will not come within the expression 'paper other than hand-made paper' as used in Notification
No. ST 3124/X-1012(4) dated 1st July, 1966, issued under section
3-A of the U.P. Sales Tax Act, 1948" observed :-
"The word 'paper' has not been defined in the Act or
the Rules, and, as such, it has to'be given the meaning which
it has in ordinary parlance. Paper, as understood in common parlance, is the paper which is used for printing, writing
and packing purposes."
In Sree Rama Trading Company v. State of Kera/a( 2) the High
Court of Kerala after a good deal of research held that cellophane
is not paper coming within entry 42 in the First Schedule to the
Kerala General Sales Tax Act, 1963, as it stood at the time relevant
to the year 1966-67.
In State of Orissa v. Gestetner Duplicators (P) Ltd.( 3) the High
Court of Orissa held that stencil paper was
not paper within the
meaning of serial No. 7-A of the Schedule to the Notification issued
by the State Government under the first proviso to section 5 ( 1) of
the Orissa Sales Tax Act, 1947 and that sale of stencil paper was,
,therefore, not taxable at the rate of 7 per cent but is exigible to tax
at the rate of 5 per cent.
•
In Commissioner of Sales Tax, U.P. v. S. N. Brothers( 1 ) this
Court while upholding the decision of the Allahabad High Court which
held that 'food colours' and 'syrup essences' are edible goods while
'dyes and. colours and compositions thereof' and 'scents and perfumes'
did not seem prima f acie to connote that they arc edible goods
observed:
(!) 31 S.T.C. 625.
(3) 33 S.T.C. 333.
(2) 28 S.T.C. 469.
(4) 31 S.T.C. 302.
I
u. P. v. KORES (lNDlA) LTD. (Jaswant Singh J.)
841
"The words 'dyes and colours' used in entry No.
10
and the words: scents and perfumes' used in entry No.
37 have to be construed in their own context and in the
sense. as ordinarily understood
and attributed to
these
words by people usually conversant with
and dealing in
such goods.
Similarly, the
words "food
colours" and
''syrup essences", which are descriptive of the class of goods
the sales of which are to be taxed under the Act, have to
be construed in the sense in which they are popularly understood by those who deal in them and who purchase and
use them."
Bearing in mind the ratio o~ the above mentioned decisions, it is
quite cle~r !hat the mer~ f~ct that.the ~ord 'pap~r.' forms part of !he
denomination of a specialised article is not dec1s1ve of the question
whether the article is paper as generally understood.
The word
'paper' in the colillilon parlance or in the commercial sense means
paper which is used for printing, writing or packing purposes.
We
are, therefore, clear of opinion that carbon paper is not paper as
envisaged by entry 2 of the aforesaid Notification.
Regarding ribbon also to which the above mentioned rule
of
construction equally applies, we have no manner of doubt that it is
an accessory and not a part of the typewriter ( un-like spool) though
it may not be possi:blei to use the latter: without the former.
Just
as aviatio~ petrol is l!ot a pa.rt of J:?e aeroplane nor diesel is a part
of a bus m the same way, nbbon is not a part o~ the typewriter
though it niay not be possible to type out any matter without it.
The very same question with which we are here confronted came
up for decision before the High Court of Mysore in State of Mysore
v. Kores (India) Ltd. (1) where it was held :
·
"Whether a typewriter ribbon is a part of a typewriter is to
be considered in the light of what is meant by a typewriter
in the commercial sense.
Typewriters are being sold in
the market without the typewriter ribbons and
therefore
typewriter ribbon is not an essential part of a typewriter
so as to attract tax as per entry 18 of the Second Schedule
to the Mysore Sales Tax Act, 1957."
A
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c
D
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F
. F01: the. fo:egoing re~sons, w.e do not find any force in this appeal
wlueh is d1sm1ssed ~mt m the circumstances of the case without any
G
order as to costs.
M.R.
Appeal dismissed.
(I) 26 S.T.C. 87.