8. Whether "fryums" are cooked food under?

Question came before the court whether "fryums" sold by the assessee are taxable as cooked food @4% or at the 8% under Part VII of Schedule II of M.P. Commercial Tax Act, 1994. Assessee treated them as cooked food and paid tax accordingly. The Assistant Commissioner while assessing for the periods 1992-93 and 1993-94 assessed them as covered under Part VII of Schedule II at 8%.

Against this order assessee came before the Madhya Pradesh High court in writ petition under Article 226/227, with the prayer that "fryums" be held as "cooked food". The High Court allowed the petition and came to the conclusion that fryums are "cooked food".

The revenue came in appeal before the apex court. In Madhya Pradesh Commercial Tax Act, 1994 "cooked food" is defined u/s 2(g) as ‘Cooked food’ includes sweets and sweetmeats, mishri, batasha, chironji, shrikhand, rabadi, doodhpak, prepared tea and prepared coffee but excludes ice cream, kulfi, ice candy, non alcoholic drink containing ice cream, cakes, pastries, biscuits, chocolates, toffees, lozenges, peppermint drops and mawa.

The petitioner relied on the decisions of M.P. High Court in the case of CST, MP vs. Shri Ballabhdas Ishwardas, Bombay Bazar Khandwa 21 STC 309 wherein the High Court has held that the term cooked food cannot be read in a wider sense so as to include everything made fit for eating by application of heat, boiling, baking, roasting, grilling etc. Then term is confined to these cooked items which one generally takes at regular meal hours.

In CST, MP vs. India Coffee Workers’ Co-operative Scty. Ltd., Jabalpur 25 STC 43 High Court has held that term "cooked food" exclude meals. Supreme court found that, the definition in sec. 2(g) is inclusive. It includes sweets and sweetmeats, mishri, batasha, chironji, shrikhand, rabadi, doodhpak, prepared tea and prepared coffee. Court observed that, in this inclusive definition intention of legislature is to include only consumables. In the case "fryums" they dough based, and it need to undergo further cooking process. It came in a plastic bag, and required to be fried depending on the taste of the consumer. Court found that when the word "includes" is used in the definition, legislature does not intend to restrict the definition; it makes the definition enumerative and not exhaustive, that is to say, the term defined will retain its ordinary meaning which in its ordinary meaning may or may not comprise. Applying the above test to the term "cooked food" in sec 2(g) and legislative intention in the present case is to include consumable. "Fryums" in the present case at the relevant time were not directly consumable. They were under cooked/semi cooked items. They require further process of frying and addition of preservatives to make them consumables even after specified time.

Commissioner of Commercial Taxes vs. T.T.K. Health Care Ltd. (7 VST 1) (S.C.)

9. Whether dog feed and cat feed is animal feed?

Held : No

Interpretation of Taxing Statutes Words "And", scope and meaning of "Comma"

Issue came for determination before the Supreme Court against the order passed by the Karnataka High Court. Entry 5 of First Schedule in Karnataka Value Added Tax Act, 2003 is about animal feed, which read as "Animal feed and feed supplements, namely, processed commodity sold as poultry feed, cattle feed, pig feed, fish feed, fish meal, prawn feed, shrimp feed and feed supplements and mineral mixture concentrate, intended for use as feed supplements including deoiled cake and wheat bra". According to the appellant, dog feed and cat feed are the products which would fall in the category of animal feed under this entry. According to appellant, the words poultry feed, cattle feed, and pig feed, etc. are the specific instances of food supplements, the word "namely" after the word "feed supplement" in entry 5 shows that the Legislature intended the words "feed supplement" to be confined to poultry feed, cattle feed, pig feed, fish feed, fish meal, prawn feed and shrimp feed. In other words, according to the appellant, animal feed and feed supplements are two expressions in entry 5 which should be read disjunctively and not conjunctively. The appellant also argued that each of the aforesaid three categories of goods covered by entry 5 is quite complete and independent in itself. The expression "and" appearing between first category and second category and between second category and third category is that in addition to first category, goods of second category and third category are also covered by the said entry. The aforesaid three categories of goods are all for feeding the animals and these have all been put under the said entry.

Not agreeing with the submission of appellant, Hon'ble Court held that, An Animal feed and a feed supplement is one category. It is after the expression "animal feed and feed supplement" that the Legislature has inserted comma, therefore animal feed supplements constitute one class of products, they do not constitute two separate classes. Further, the expression "animal feed and feed supplement" is not only followed by the "comma" it is followed by the word "namly" which indicates that items mentioned after the word "namely" like poultry feed, cattle feed, pig feed, fish feed, etc., are specific instances of animal feed and feed supplement, which would fall in entry 5. That list is exhaustive,. In that list, the Legislature has not included dog feed/cat feed, therefore, the products of the appellant do not fall under entry 5 of the First Schedule of the Act. In our view, the basic premise on which the argument of the assessee proceeds is that the entry 5 covers three categories of the goods, namely, animal feed, feed supplement, and feed supplements and mineral mixtures. This premise is wrong. A bare reading of the said entry indicates "animal feed and feed supplements" as constituting one category. They are not two separate categories. The punctuation mark "comma" has been used expressly after the words "animal feed and feed supplements" which indicates that the legislature intended to classify these two items as one class/category. Further, the Legislature intended to restrict that category by confining that category to processed commodity alone and that too for certain named animals. In the present case we are concerned with cat feed and dog feed. Cat feed carries a fishy smell on account of processing. However, the cat feed though processed is not put in entry 5. Similarly, dog feed is also excluded from entry 5. In the circumstances, we do not find any merit in the arguments advanced on behalf of assessee.

Shree Durga Distributors vs. State of Karnataka (7 VST 267 SC)