SOHLI EDULJEE CAPTAIN (Secco Brushes Corporation), Appellant, and COMMISSIONER O

069-NLR-NLR-V-77-SOHLI-EDULJEE-CAPTAIN-Secco-Brushes-Corporation-Appellant-and-COMMISSIONER-O.pdf


360
WIJAYATILAKE, J.—Captain v. Commissioner of I land Revenue
1974 Present: Wijayatilake, J., Walgampaya, J., and Sirimane, J.SOHLI EDULJEE CAPTAIN (Secco Brushes Corporation),Appellant, and COMMISSIONER OF INLAND REVENUE,
Respondent
S.C. 2173—Income Tax Case BRA/BTT/3
Income tax—Finance Act No. 11 of 1963—Section 119— -Order madethereunder by Minister on 2nd September 1969—Tooth brushes nottaxable under Part VIII of the Schedule—Meaning and effect ofwords “toilet requisites”—Interpretation of statutes–Scope ofejusdem generis rule of construction—Taxing statute—Require-ment of unambiguous language.
A tooth brush is not an expendable substance and, therefore, isnot an article falling within the meaning of the words “ cosmetics,perfumes, hair-dressing and toilet requisites (excluding soap, hair oiland tooth powder) ”, in Part VIII of the Schedule in the Order madeunder Section 119 of the Finance Act No. 11 of 1963 and publishedin the Government Gazette No. 14,864/9 dated 2nd September, 1969.
Scope of ejusdem generis rule of construction in interpretingstatutes discussed.
Express and unambiguous language is indispensable in a statutepassed for the purpose of imposing a tax. In a Taxing Statute, if twoconstructions are possible, one in favour of the assessee and iheother in favour of the assessor, the Court must adopt the constructionwhich is favourable to the assessee.
CaSE stated by the Income Tax Board of Review for theopinion of the Supreme Court.
S. Ambalavanar, with C. Pathmanathan, W. H. Perera,P. Dominic and D. A. N. Jayamaha, for the assessee-appellant.
S. Sivarasa, Senior State Counsel, for the Attorney-General.
Cur. adv. vult.
May 23, 1974. Wijayatilake, J.—
A question of law on which the opinion of the Supreme Courtis sought is :
Whether a tooth brush is an article coming within themeaning of the words “ cosmetics, perfumes, hair-dressingand toilet requisites (excluding soap, hair oil and toothpowder) ”, in Part VIII of the Schedule in the Order madeunder Section 119 of the Finance Act No. 11 of 1963 andpublished in the Ceylon Government Gazette No. 14,864/9dated 2.9.69. The assessee paid tax at 5 per cent. The assessormade an additional assessment of 15 per cent, on the groundthat the manufacture of tooth brushes came within Part VIIIof the Schedule of the said Order. The amount of tax indispute is Rs. 153,012 (excluding penalty).
WIJA.YATLLAKE, J.—Captain v. Commissioner of Inland Revenue
361
The members of the Board of Appeal, by their order dated
held that tooth brushes were taxable under Part VIIIof the Schedule, as—
tooth brushes are toilet requisites,
the toilet requis.tes which are excluded from Part VIII
and expressly mentioned and the exceptions men-tioned do not include tooth brushes,
the principal characteristic common to “ cosmetics,
perfumes, hair-dressing ” is tnat these are used toenhance personal appearance,
‘ toilet requisites ’ in Part VIII of the Schedule would
include tooth brushes even if the eiusdem generis ruleof construction is followed.
The Board, in giving their reasons, observed that the articlesreferred to are familiar items of daily use in the process ofdressing and grooming and they do not agree that the term ‘ toiletrequisites ’ must necessarily be given a very wide connotation ;although a general term, it means things which are used for theenhancement of one’s appearance. It certainly does not mean torefer to everything that is found in a bath room, for that wouldbe to confuse ‘ toilet requisites’ with ‘ toilet fittings ’ (in whichexpression the word ‘ toilet ’ s used in a secondary and unusualsense). The eiusdem generis rule is not a rule of constructionwhich must be applied in every case where specific words arefollowed by general words. The general words must be giventheir ordinary meaning, unless the context in which the words areused show that the general words were intended to have only arestricted meaning. Soap, hair oil, tooth powder are expresslyexcluded, but not tooth paste and tooth brushes. The itemsexcluded are undoubtedly toilet requisites. The order expresslydeclares the items to be excluded from Part VIII. It is implicitthat toilet requisites which do not come within the exception areliable to be charged under Part VIII.
The Board proceeds to observe that since both +he Commis-sioner in his finding and the Assessor who appeared before theBoard agreed with Counsel for the Assessee that ‘ toiletreq uisites ’ is a wide expression which was narrowed down bythe eiusdem generis rule, they would proceed to consider theaoplication of that rule to the clause in question. Where theCommissioner and the Assessor differed from learned Counsel isin the selection of characteristics or quality in the specific itemswhich would narrow the scope of the general words ‘ toiletrequisites The Board is unable to agree with the submission of
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WIJA 'AT [LAKE, JCaptain o. Commissioner of Inland Revenue
learned Counsel for the Assessee that the words ‘ toiletrequisites ’ will not include tooth brushes on the eiusdem generisrule, as the specific items listed are expendable substances. Forthe purpose of the eiusdem generis rule, the Board states thatthey should not look for a trivial or strained characteristic in thegroup. They must ask what is the common and dominant featurewhich the specific things possessed. In their opinion, this clearlylies in their use for personal appearance. For instance, the words‘ hair-dressing ’ would include hair cream or hair lotion whichare expended by use, and also articles like hair pins, hair netsand hair brushes which are not expended by use. Therefore, theBoard has come to the conclusion that the words * toiletrequisites ’ cannot be restricted to mean only articles that areexpended.
Mr. Ambalavanar, Counsel for the Appellant, has drawn ourattention to a series of cases dealing with the interpretation ofTaxing Statutes. It has been held that express and unambiguouslanguage is absolutely indispensable in Statutes passed for thepurpose of imposing a tax, for such a Statute is always strictlyconstrued. In a Taxing Statute, therefore, if two constructionsare possible, one in favour of the assessee and the other in favourof the assessor, the Court must adopt the construction which isfavourable to the assessee—vide Mohamed v. Commissioner ofInland Revenue 64 N.L.R. p. 400 at 403 ; Commissioner of InlandRevenue v. Crusz Raj Chandra2, 67 N.L.R. p. 174 at 182. In thecase of Bladnoch Distillery Co. Ltd’ (1948) 1 All England Reports,p. 616 at 625, Lord Thankerton observed as follows : “ I cannotthink that there can be much doubt as to the proper canons ofconstruction of this Taxing Section. It is not a penal provi-sion ; Counsel are apt to use the adjective ‘penal’ in describingthe harsh consequences of a taxing provision, but, if the meaningof the provision is reasonably clear, the Courts have no jurisdictionto mitigate such harshness. On the other hand, if the provisionis reasonably capable of two alternative meanings the Courtswill prefer the meaning more favourable to the subject. If theprovision is so wanting in clarity that no meaning is reasonablyclear, the Courts will be unable to regard it as of any effect.”In the case of The Commissioner of Income Tax, Bombay City v.Provident Investment Co. Ltd., 4 32 (1957) Income Tax Reports,p. 190 at 191, the Supreme Court held that if the Revenuesatisfies the Court that a case falls strictly within the provisionsof the law, then the subject can be taxed. If, on the other hand,the case is not covered within the four corners of the provisionsof the Taxing Statute, no tax can be imposed by inference or
l64 N.L.R. at 403.*67N.L.R. at 182.
*(1948) 1 A.E.R. at 625.
* 32 Income Tax Reports at 191.
WTJ AYATILAKE, JCaptaii v. Commissioner of Inland Revenue
353
analogy or by trying to probe into the intentions of the Legisla-ture and by considering what was the substance of the matter —see also Commissioner of Income Tax, Madras v. BossatoBrothers Ltd.1 8 (1940) Income Tax Reports, p. 41 at 48.Mr. Ambalavanar has also drawn our attention to the CeylonGovernment Gazette Extraordinary No. 14,820/4 of 26.9.68 and14,864/9 of 2.8.69.
In regard to the question as to whether the eiusdem generisrule applies to the facts before us, both Mr. Ambalavanar andMr. Sivarasa have referred us to Maxwell on the Interpretationof Statutes, 12th Edition, pp. 297 to 305. I might sum up therelevant principles set out therein: “ In the abs ract, generalwords, like all others, receive their full and natural meaning,and the Courts will not impose on them limitations not calledfor by the sense or objects of the Enactment. But the generalword which follows particular and specific words of the samenature as itself takes its meaning from them and is presumed tobe restricted to the same genus as those words. For, accordingto a well established rule, in the construction of Statutes, generalterms following particular ones apply only to such persons orthings as are eiusdem generis with those comprehended in thelanguage of the Legislature. In other words, the general expres-sion is to be read as comprehending only things of the same kindas that designated by the preceding particular expressions,unless there is something to show that a wider sense was intendedas where there is a provision specifically excepting certain
classes clearly not within the suggested genus The rule
applies only to general words following words which are lessgeneral. Unless there is a genus or class or category, there isno room fo~ any application of the eiusdem generis doctrine. Ina modern Privy Council case it has been said that there must bemore than one species mentioned to constitute a genus; but theauthority on this is very slight and there are many instancesof the rule being applied to two-word phrases. The rule ofeiusdem generis may apply despite the absence of the word* cither ’ at the end of the list of things specified.. The eiusdemgeneris doctrine is by no means an absolute one, and if it can beseen from a wider inspection of the scope of the legislation thatthe general words ought to be construed generally, they areso construed notwithstanding that they follow more particularexpressions. The wording of the Statute may also show that thegeneral language is to be construed generally. ”
In regard to the apnlicabilitv of the eiusdem generis rule,Mr. Sivarasa, learned Senior State Counsel, has relied on the
8 Income Tax Reports at 48.
354 WIJAYATILAKE, J.—Captain v. Commissioner of Inland Revenue
following cases: Anderson v. Anderson1 (1895) 1 Q.B.D. 749,where it was held that when, in the operative part of a deed,general words follow an enumeration of particular things, thosewords are prima facie to be construed as having their naturaland larger meaning, and are not to be restricted to thingseiusdem generis with those previously enumerated, unless thereis something in the deed which shows an intention so to restrictthem. In National Association of Local Government Officers v.Bolton Corporationa 1943 A.C. p. 166 at 176, it was held that theuse of the words ‘ or otherwise ’ does not bring into play theeiusdem generis principle, for 4 manual labour ’and 4 clei'icalwork ’ do not belong to a single limited genus. In Alan v.Emmerson3 (1944) 1 A.E.B. p. 344 at 347, Asquith J. observedthat: “ words excepting a species from a genus are meaninglessunless the species in question pr'ma facie falls within the genus;and that no case was cited in which a genus has been held to beconstituted not by the enumeration of a number of classes follow-ed by the words * or other ’, but by the mention of a singleclass (in this case 4 theatre ’) followed by those words; and thatthe tendency of the more modern authorities is to attenuate theapplication of the eiusdem generis rule—see Anderson v.Anderson. In Chandris v■ Isbrandtsen-Moller Co. (1950), 1 A.E.R.768, Devlin J. a^ooted the princiole in Anderson v. Anderson—seealso Rands v. Oldroyd, 1 Q.B.D. p. 204 at 212.
Mr. Ambalavanar has very strenuously submitted that on areading of the regulation in question it is quite clear that thewords ‘toilet requisites ’ have to be given a restrictive interpre-tation. Even the Board of Appeal has held that these wordsshould not be given too wide an interpretation. As far as I couldsee, on a reading of the order made by the Board, inferentiallythey have adopted the eiusdem generis rule with certainlimitations. For instance, they observe that these wordscertainly do not mean to refer to everything that is found in abath room, for that would be to confuse 4 toilet requisites ’ with‘ toilet fittings ’ (in which expression the word 4 toilet ’ is usedin a secondary and unusual sense). However, the question doesarise, if only the words 4 toilet requisites * appeared in thisregulation, whether they would not include articles such asmirrors, commodes, bidets, wash basins, bath tubs and otherdevices which certainly are necessary for personal hygiene andthe enhancement of one’s appearance. As for the meaning of thewords 4 toilet requisites ’, according to the Oxford Dictionary,a 4 requisite ’ is something needed for accomplishment of somepurpose. So that 4 toilet requ:sites ’ are something needed foraccomplishment of one’s toilet. I do not think we can confine
1 (1895) 1 Q.B.D. 749.* (1943) A.C. at 178.
■<(1944) 1 A.E.R. at 347.
WIJAYATILAKE, J.—Captain v. Commissioner of Inland Revenue 366
* toilet ’ only to the process of beautifying the face and dressingthe hair ; it is something much more elaborate and we have tokeep the whole body in mind. Therefore, even articles such asthe ones I have mentioned above would come within theexpression * toilet requisites In this context I might refer to afascinating article by Justice L. W. de Silva on “ Roman women—paint, powder and perfume” in PALMA—journal of theClassical Association of Ceylon (1972), page 78, where, on theauthority of Roman and Greek poets, he has given a peep intothe part played by cosmetics in Rome and Greece. “ The wordcosmeta in Roman times meant the valet or femme de chamhrewho had charge of the wardrobe and ornamentation of the ladyOne must not forget the mere male who also has to rely oncertain * toilet requisites ’ to make himself presentable. Thus, itis quite evident that this expression by itself has to be givena wide interpretation. The question arises whether in the contextin which it appears the eiusdem generis doctrine applies.
In my view, the reasons given by the Board add to theweight of the argument advanced by Mr. Ambalavanar thatthis doctrine does apply in the instant case as the words inquestion have to be given a restrictive interpretation. I mightmention that even the Deputy Commissioner, who heard theappeal, was of the same view. The Board has proceeded to holdthat even if this rule applies they must not look for a trivial orstrained characteristic in the group and they must ask what isthe common and dominant feature which the specific thingspossess. In their opinion, this clearly lies in their use for personalappearance. So that the words ‘ toilet requisites ’ would includeboth articles that are expended by use and also articles notexpended by use, like pins, hair nets and hair brushes. In thiscontext, if we study the wording of this regulation minutely,it would appear that the articles which have been excluded,namely, soap, hair oil and tooth powder, give us a clue to acorrect interpretation. Mr. Sivarasa has very cogently stressedthat the exclusion of tooth powder points to the fact that toothpaste has to be included, and, if tooth paste has to be included,it follows that tooth brushes too fall into the same categoryas the two go together. However, in my opinion, the particulararticles which are excluded indicate that the Legislature had inmind the common man. Mr. Sivarasa concedes this. If the words‘ toilet requisites ’ covered such articles as hair pins, hair netsand tooth brushes and combs, why in the interests of the commonman was the common comb not excluded ? It is very unlikely thatthis would have escaped the attention of the draftsman. As itstrikes me, the exclusion of the comb was not necessary becausethe words * toilet requisites ’ did not include articles of thatcategory. So that there appears to be considerable force in the
35»
Gunawardena, v. Baaficm
submission made by Mr. Ambalavanar that the words ‘ toiletrequisites ’ do not include tooth brushes as the items whichprecede these words, and the items which have been excluded,are clearly expendable substances. I do not think there is muchweight in the submission that tooth paste (which is included)would be of little avail without a tooth brush, as we knowthat a tooth brush can be used effectively even without toothpaste. I am not inclined to agree that a tooth brush as such is aluxury article in the toilet, although ‘ tooth paste ’ may perhapsbe so recognized. Nor am I inclined to treat a tooth brush as anexpendable article as the bristles wear away. As I have alreadyobserved, what has impressed me very favourably in coming toa conclusion on this matter is the fact that the common comb hasnot been excluded from this regulation. Even if there is a doubtin regard to the interpretation, it should be resolved in favour ofthe assessee. I
I would accordingly hold that a tooth brush is not an articlewhich falls within the scope of this regulation.
The appellant will be entitled to costs of these proceedingswhich I fix at Rs. 500.
Walgampaya, J.—I agree.
Sirimane, J.—I agree.
Appeal allowed.