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The Ratlam Bone & Fertilizer Co. v. The State Of Madhya Pradesh And Another
Factual and Procedural Background
The petitioner is the Ratlam Bone and Fertilizer Company, a partnership firm engaged in grinding bones for use as fertilizer and registered as a dealer under both the Madhya Pradesh General Sales Tax Act, 1959 (the State Act) and the Central Sales Tax Act, 1956 (the Central Act). The relevant assessment period ran from 1 November 1959 to 19 October 1960.
Initial assessment under the State Act (order dated 6 October 1961) recorded the petitioner's "turnover" from sales of bone-meal at Rs. 147; the Central Act assessment (order dated 30 October 1961) recorded a "turnover" of Rs. 1,57,356. Both assessments treated sales of bone-meal as free from tax on the basis that bone-meal was a fertilizer exempt under entry No. 22 of Schedule I read with Section 10(1) of the State Act.
Subsequently, notices for reassessment were issued on the ground that turnover from bone-meal had escaped assessment. Reassessment under the State Act occurred on 30 September 1966 and under the Central Act on 24 March 1967. The assessing authorities relied on a High Court Division Bench decision in Commissioner of Sales Tax v. Sagar Bone Mills ([1966] 18 S.T.C. 338) holding that bone-meal, though a fertilizer, was not exempt from sales tax. Following that decision, the assessing authorities assessed the bone-meal turnover to tax under both Acts.
The petitioner challenged these reassessment orders by filing a writ petition under Article 226 of the Constitution. When the matter reached a Division Bench, the correctness of the Sagar Bone Mills decision was questioned, and the matter was referred to a Full Bench, resulting in the present order.
Legal Issues Presented
- Whether bone-meal (powdered bones) falls within entry No. 22 of Schedule I of the State Act as a tax-exempt "fertilizer" under Section 10 and therefore must be excluded from taxable "turnover".
- Whether the specific inclusion of "powdered bones" in Schedule II (entry No. 9) and Schedule III (entry No. 2) of the State Act can be harmonized with the general exemption for "fertilizer" in Schedule I, or whether the general exemption must override the specific schedule entries.
- Whether treating powdered bones as taxable while other fertilizers remain exempt results in an unreasonable classification violative of Article 14 of the Constitution.
- Whether the reassessment orders (following the earlier Division Bench decision in Commissioner of Sales Tax v. Sagar Bone Mills) were valid and sustainable.
Arguments of the Parties
Petitioner's Arguments
- Bone-meal is a "fertilizer" within entry No. 22 of Schedule I and so sales of bone-meal are completely exempt from tax under Section 10; therefore such sales cannot be included in taxable "turnover".
- Although "powdered bones" appear in entry No. 9 of Schedule II and entry No. 2 of Schedule III, Section 10 (and the Schedule I exemption) is the leading provision and must prevail over conflicting entries in Schedules II and III.
- The legislature's explicit exclusion of oil-cakes from entry No. 22 shows a deliberate choice; there is no specific exclusion for powdered bones, so powdered bones should remain within the exemption.
- Reading powdered bones as taxable would create an unreasonable and constitutionally invalid classification between powdered bones and other fertilizers, infringing Article 14.
- Alternatively, powdered bones (as mentioned in Schedules II and III) should be limited to powdered bones which are not fertilizers — i.e., powdered bones should be divided into (1) those that are fertilizers and (2) others — and only the latter should be taxable.
Respondent / Assessing Authority Position
- The assessing authority relied on the High Court Division Bench decision in Commissioner of Sales Tax v. Sagar Bone Mills ([1966] 18 S.T.C. 338) which held that bone-meal is not exempt and that bone-meal falls within entries in Schedules II and III and is therefore taxable; reassessment orders were issued and bone-meal turnover assessed accordingly.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Venkataramana Devaru v. State of Mysore, A.I.R. 1958 S.C. 255 at 268 | Principle of harmonious construction when two provisions appear to conflict. | Used as primary authority to justify interpreting the general "fertilizer" entry so as to give effect to the specific inclusion of "powdered bones" in other schedules. |
| Calcutta-Gas Co. (Prop.) Ltd. v. State of W.B., A.I.R. 1962 S.C. 1044 at 1051 | Harmonious construction must not reduce a provision to a "useless lumber" or "dead letter". | Supported the court's insistence that the interpretation must give meaning to both the general and specific provisions without nullifying either. |
| J.K.C.S. & W. Mills v. State of U.P., A.I.R. 1961 S.C. 1170 at 1174 | Same theme: harmonizing provisions without destroying one. | Reinforced the approach to resolve the apparent conflict between Schedule I and Schedules II & III by restricting the general term rather than cancelling the specific entries. |
| Chief Inspector of Mines v. K.C. Thapar, A.I.R. 1961 S.C. 838 at 843 | Principle that harmonization is not destruction; both provisions should be given effect if possible. | Supported the court's methodology in construing competing schedule entries together. |
| S.I. Corporation (P.) Ltd. v. Secretary, Board of Revenue, A.I.R. 1964 S.C. 207 at 215 | Where conflict exists, distinguish which provision is general and which is specific and construe the general so as to exclude the specific. | Applied to characterize "fertilizer" as the general term and "powdered bones" as the specific; thereby limiting the general term to avoid conflict. |
| Waverly Jute Mills v. Raymon & Co., A.I.R. 1963 S.C. 90 at 95 | Illustrates the general-versus-specific approach in statutory harmonization. | Used as supporting authority for treating "powdered bones" as a specific category within the broader class of "fertilizer". |
| East Bourne Corporation v. Fortes Ltd., [1959] 2 All E.R. 102 at 107 | When reconciliation is possible, both provisions should be given effect; the legislature is presumed to intend both provisions in the same Act. | Supported refusal to treat Section 10/Schedule I as automatically overriding Schedules II & III where harmonization is possible. |
| Ram Krishna v. Janpad Sabha, A.I.R. 1962 S.C. 1073 at 1079 | Later amending Acts can clarify ambiguity in earlier Acts. | Permitted the court to treat the 1966 amendment (excluding powdered and crushed bones from Schedule I) as confirmatory and clarifying of the earlier ambiguity. |
| S.B. Dayal v. State of U.P., A.I.R. 1972 S.C. 1108 | Legislature has wide classification power in fiscal measures. | Supported rejection of the claim that taxing powdered bones alone violated Article 14 without evidence of hostile discrimination. |
| Twyford Tea Co. Ltd. v. Kerala State, A.I.R. 1970 S.C. 1133 at 1137-1139 | Courts give wide latitude to legislature in taxation; clear hostile discrimination is required to strike down fiscal measures under Article 14. | Applied to hold that mere differential treatment of powdered bones versus other fertilizers does not, without material, establish unconstitutional discrimination. |
| M. Match Works v. Assistant Collector, Central Excise, A.I.R. 1974 S.C. 497 at 504 | Further support for the wide latitude in fiscal classifications (cited at para 19 of the opinion). | Reiterated that the court will not assume unreasonable classification without supporting material. |
| Commissioner of Sales Tax v. Sagar Bone Mills, [1966] 18 S.T.C. 338 (Division Bench) | Applied the rule of harmonious construction to exclude bone-meal from the fertilizer entry in Schedule I and include it under Schedules II & III. | The Full Bench agreed with this Division Bench conclusion and relied on it as the basis for upholding reassessments taxing bone-meal. |
Court's Reasoning and Analysis
The court began by setting out the relevant statutory framework in the State Act: definitions of "turnover" (Section 2(t)) and "taxable 'turnover'" (Section 2(r)), the incidence of taxation (Section 4), the charging provisions (Section 6 and Schedule II) and the licence-fee alternative for Schedule III (Section 13). These provisions show separately that (a) Section 10 and Schedule I can declare sale prices tax-free, and (b) Sections 6 and 13 together indicate that goods specified in Schedules II and III were intended to be the subject of taxation or licence-fee treatment.
The court identified an apparent conflict: the general term "fertilizer" in entry No. 22 of Schedule I would, standing alone, include powdered bones, yet powdered bones are expressly listed in Schedules II and III. The court applied the well-established rule of harmonious construction (citing authorities) to resolve the conflict so that both provisions could have meaningful operation.
Applying the specific-over-general principle, the court held that the word "fertilizer" in Schedule I must be construed to exclude powdered bones because "powdered bones" are specifically mentioned in Schedules II and III. This interpretation gives operative effect to both entries: preserves the exemption for other fertilizers in Schedule I while allowing the legislature's specific inclusion of powdered bones in the taxing schedules to stand.
The court rejected the petitioner's contention that this interpretation involved reading an exception into Schedule I. It explained that the exception is implicit by virtue of the specific treatment provided elsewhere in the Act; harmonizing provisions does not amount to judicial addition but is an instance of reading specific and general provisions together.
On the Article 14 challenge, the court observed that taxation statutes permit wide legislative classification and that no material had been shown to establish clear and hostile discrimination between dealers in powdered bones and dealers in other fertilizers. Consequently, the claim of unconstitutional classification failed.
The court further noted confirmatory support in the form of a later legislative amendment: Entry No. 22 of Schedule I was amended by Madhya Pradesh Amendment Act No. 16 of 1966 to expressly exclude powdered and crushed bones from the fertilizer entry, which the court treated as clarifying the ambiguity that previously existed. The court also examined technical and industry material (standards under the Fertilizer (Control) Order, and government trade/marketing descriptions) showing that bone-meal is a powdered product and is commonly used as fertilizer, and rejected the petitioner's attempt to divide powdered bones into two practicable categories (fertilizer vs. non-fertilizer) for statutory purposes as artificial and unworkable.
Finally, the court expressly agreed with the earlier Division Bench in Commissioner of Sales Tax v. Sagar Bone Mills, which had applied the same harmonious-construction approach and reached the conclusion that powdered bones are not covered by the general fertilizer exemption but are taxable under Schedules II and III.
Holding and Implications
Holding: The petition is DISMISSED. The Full Bench agreed with the Division Bench decision in Commissioner of Sales Tax v. Sagar Bone Mills that powdered bones (bone-meal) are not included in the tax-exempt entry for "fertilizer" in Schedule I and that powdered bones are liable to tax as specified in Schedule II (and subject to Schedule III treatment where appropriate).
Immediate consequences and directions given in the order:
- No order as to costs was made.
- The amount of security deposit shall be refunded to the petitioner.
- The reassessment orders (which had assessed the petitioner's bone-meal turnover to tax) stand upheld by the dismissal of the petition.
Broader implications: The court's decision applies the established doctrine of harmonious construction to resolve apparent conflicts between a general exemption entry and specific taxing entries within the same statute. The opinion does not purport to create a novel principle of law; instead, it affirms and applies existing authorities and accepts the Division Bench's conclusion in Commissioner of Sales Tax v. Sagar Bone Mills.
ORDER G.P. Singh, J.
1. This is a petition under Article 226 of the Constitution and is directed against two orders of reassessment; one under the Madhya Pradesh General Sales Tax Act, 1959, and the other under the Central Sales Tax Act, 1956.
2. The facts are that the petitioner, the Ratlam Bone and Fertilizer Company, is a partnership-firm carrying on business of grinding bones for use as fertilizer. It is registered as a dealer both under the state act and the central act. The relevant period of assessment is from 1st November, 1959, to 19th October, 1960. The assessment order under the State Act was passed on 6th October, 1961. In this order the petitioner's "turnover" relating to sales of bone-meal, i. e., powdered bones used as fertilizer, was assessed at Rs. 147. The assessment order under the Central Act was passed on 30th October, 1961, in which the "turnover" of sales of bone-meal was assessed at Rs. 1,57,356. These "turnover"s of sales of bone-meal, both under the State Act and the Central Act, were held to be free from liability of tax on the reasoning that bone-meal being a fertilizer was exempt from sales tax under entry No. 22 of Schedule I read with Section 10(1) of the State Act. Thereafter notices were issued to the petitioner for reassessment under both the Acts on the ground that the "turnover"s relating to sales of bone-meal had escaped assessment. The reassessment under the State Act was made on 30th September, 1966, and under the Central Act on 24th March, 1967. In these reassessment orders it was pointed out by the assessing authority that the High Court in Commissioner of Sales Tax v. Sagar Bone Mills, Sugar : No. 1 [1966] 18 S.T.C. 338 had held that bone-meal although a fertilizer was not exempt from sales tax. Following the judgment of the High Court, the assessing authority assessed the "turnover"s of bone-meal to tax both under the state act and the central act. The petitioner thereafter filed the present writ petition challenging the aforesaid reassessment orders. When the petition came up for hearing before a Division Bench, the view taken by the High Court in Commissioner of Sales Tax v. Sugar Bone Mills, Sugar : No. 1 [1966] 18 S.T.C. 338 was questioned and, therefore, the petition was referred to a Full Bench and this is how the matter comes up before us.
3. Before we advert to the contentions raised by the learned counsel for the petitioner it is necessary to refer to the relevant statutory provisions of the state act as they were in force during the period of assessment. Section 2(t) of the Act defines
"turnover"in relation to any period as meaning:
the aggregate of the amount of sale prices received and receivable by a dealer in respect of any sale or supply or distribution of goods made during that period, whether or not the whole or any portion of such "turnover" is liable to tax but after deducting the amount, if any, refunded by the dealer to a purchaser, in respect of any goods purchased and returned by the purchaser within the prescribed period.
The expression "taxable "turnover"", in relation to any period, is denned by Section 2(r) which, in so far as it is relevant, reads :
'Taxable "turnover"' in relation to any period means that part of a dealer's "turnover" for such period which remains after deducting therefrom-
(i) the sale price of goods declared tax-free under Section 10 or Section 12.
Section 4 of the Act provides for incidence of taxation and sub-section (1) of this section reads as follows:
Every dealer whose "turnover" during a period of twelve months immediately preceding the commencement of this Act exceeds the limit specified in Sub-section (5) shall, from such commencement be liable to pay tax under this Act, on his taxable "turnover" in respect of sales or supplies of goods effected in Madhya Pradesh.
Tax is levied under Section 6 of the Act, which provides that:
The tax payable by a dealer under this Act shall be levied on his taxable "turnover" relating to goods specified in Schedule II, at the rate and at the point mentioned in the corresponding entry in columns 3 and 4 respectively, of the said schedule.
The relevant entry in Schedule II is entry No. 9, which reads as follows :
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4. The first contention raised by the learned counsel for the petitioner is that bone-meal is fertilizer within entry No. 22 of Schedule I and, therefore, sales of bone-meal are completely exempt from tax under Section 10 and cannot be included in taxable "turnover". While so arguing the learned counsel did not dispute that bone-meal consists only of "powdered bones" which are included in entry No. 9 of Schedule II and entry No. 2 of Schedule III. But it was argued that Section 10 of the Act is the leading provision and, therefore, the entry of exemption in Schedule I will prevail over the entries in Schedules II and III. It was also argued that entry No. 22 of Schedule I itself shows that the legislature was conscious of excluding "oil-cakes" from that entry and that no further exception can be read in it. It was further argued that if exemption in respect of powdered bones is read in entry No. 22 of Schedule I, that will create an unreasonable classification between powdered bones and fertilizer other than powdered bones and will result in making the levy of tax on powdered bones invalid. For these reasons, the learned counsel submitted that the expression "powdered bones" finding place in entry No. 9, Schedule II, and entry No. 2, Schedule III, should be overlooked as a drafting error to give full meaning to the legislative intention of making all fertilizers other than oil-cakes tax-free.
5. The difficulty in accepting the above contention of the learned counsel for the petitioner is that by accepting it we will have to strike off the specific inclusion of "powdered bones" by the legislature in entry No. 9 of Schedule II and entry No. 2 of Schedule III. A drafting error of this magnitude cannot be presumed and such a result can be reached only as a matter of last resort when it is not possible to resolve the conflict in the competing entries by resort to the rule of harmonious construction. Just as entry No. 22 in Schedule I read with Section 10 prima facie shows the legislative intention that sales of fertilizers other than oil-cakes should be tax-free, entry No. 9 in Schedule II read with Section 6 and entry No. 2 in Schedule III read with Section 13 go to show that the legislature intended to tax sales of powdered bones. Section 6 of the Act says that the tax payable by a dealer under the Act shall be levied on his taxable "turnover" relating to goods specified in Schedule II at the rate mentioned in the corresponding entry in the said schedule. The language of this section shows that the legislature intended to tax the sales of goods specified in Schedule II at the rates mentioned therein. Similarly, Section 13, which provides for payment of licence fee in lieu of tax in case of dealers doing business in goods specified in Schedule III, shows that the legislature intended to tax the sales of goods specified in Schedule III. The language used in Sections 4 and 13 thus shows that the sales of "powdered bones" were intended to be taxed by the legislature. Section 10 exempts from tax sales and purchases of goods specified in Schedule I. Therefore, Section 10 read with entry No. 22 in Schedule I shows that the legislature intended to exempt sales of fertilizer other than oil-cakes. As powdered bones also fall within the description of fertilizer, there is an apparent conflict between entry No. 22 of Schedule I and entries Nos. 9 and 2 in Schedules II and III. This conflict has to be resolved by applying the rule of harmonious construction.
6. The rule of harmonious construction means that when there is an apparent conflict between two provisions of the same Act, they should be so interpreted that, if possible, effect should be given to both: Venkataramana Devaru v. State of Mysore A.I.R. 1958 S.C. 255 at 268. It is the very essence of this rule that effect must be given to both the provisions ; therefore, a construction which reduces one of the provisions to a "useless lumber" or "dead letter" is not harmonious construction : Calcutta- Gas Co. (Prop.) Ltd. v. State of W.B A.I.R. 1962 S.C. 1044 at 1051 and J.K.C.S. & W. Mills v. State of U.P. A.I.R 1961 S.C. 1170 at 1174. To harmonize is not to destroy : J.K.C.S. & W. Mills v. State of U.P. A.I.R 1961 S.C. 1170 at 1174 and Chief Inspector of Mines v. K.C. Thapar A.I.R. 1961 S.C. 838 at 843. A familiar approach in the application of the rule is to find out which of the two apparently conflicting provisions is more general and which is more specific and to construe the more general one so as to exclude the more specific : S.I. Corporation (P.) Ltd. v. Secretary, Board of Revenue A.I.R. 1964 S.C. 207 at 215, Waverly Jute Mills v. Raymon & Co. A.I.R. 1963 S.C. 90 at 95 and v. J.K.C.S. & W. Mills v. State of U.P. A.I.R 1961 S.C. 1170 at 1174.
7. The word "fertilizer" is more general than the expression "powdered bones". Within the word "fertilizer" comes all types of manures, natural and artificial, and standing alone the word is wide enough to include powdered bones. But as "powdered bones" have been separately mentioned in Schedules II and III showing clear intention that their sales are liable to tax, the word "fertilizer" in entry No. 22 in Schedule I must be construed to mean manures other than powdered bones. It is in this way that effect can be given to entries of "powdered bones" in Schedules II and III as also to the entry of "fertilizer" in Schedule I. It is true that a more careful draftsman would have excluded powdered bones from the entry of fertilizer just as oil-cakes have been excluded. But even in the absence of any specific exclusion of powdered bones from the entry of fertilizer, we reach the same result by applying the rule of harmonious construction. The argument that by so restricting the meaning of fertilizer we will be reading some words in entry No. 22 of Schedule I which are not there and this cannot be done must be rejected. Whenever the scope of a general word or provision is restricted because of some specific provision made elsewhere in the Act by applying the rule of harmonious construction, it may appear as if the court has read an exception in the general provision not specifically made in it by the legislature. But this is not really so. The exception is made by the legislature itself in enacting the specific provision and all that the court does is to read the general and the specific provisions together so as to avoid any apparent conflict and to give meaning to both the provisions.
8. The argument of the learned counsel for the petitioner that by holding that the sales of powdered bones are subject to tax, an unreasonable classification between powdered bones and other fertilizers will result and the tax on sales of powdered bones will be violative of Article 14 of the Constitution and, therefore, the word "fertilizer" should be given its full effect and the entries of "powdered bones" in Schedules II and III should be ignored as redundant is without any substance. It is well-settled that the power of classification allowed to the legislature in enacting a fiscal measure is very wide : S.B. Dayal v. State of U.P. A.I.R. 1972 S.C. 1108. The legislature is allowed to pick and choose districts, objects, persons, methods and rates for taxation. The courts have permitted a very wide latitude for tax purposes and clear and hostile discrimination has to be established before a taxing Act is struck down as contravening Article 14 : Twyford Tea Co. Ltd. v. Kerala State A.I.R. 1970 S.C. 1133 at 1137-1139. See further M. Match Works v. Assistant Collector, Central Excise A.I.R. 1974 S.C. 497 at 504, para 19. No material has been placed before us to show that dealers in powdered bones and dealers in other fertilizers come under the same class and that a tax liability imposed on the former will create a hostile discrimination. We cannot assume in favour of unreasonable classification without any material being placed before us.
9. Equally untenable is the argument that Section 10 of the Act is the leading provision and, therefore, entry No. 22 of Schedule I must override entry No. 9 in Schedule II and entry No. 2 in Schedule III. We have already shown that these apparently conflicting entries in the schedules can be reconciled by applying the rule of harmonious construction arid meaning can be given to each one of them. It is only when reconciliation is not possible that it has to be seen as to which of the conflicting provisions is the leading provision and which is the subordinate one. In cases where two provisions are absolute contradictions of each other, the leading provision is said to override the subordinate one. But this is an argument of last resort, as the first duty of the court is to give effect to both the provisions, for it is presumed that the legislature by including them in the same Act intended to give effect to both of them : East Bourne Corporation v. Fortes Ltd. [1959] 2 All E.R. 102 at 107. As in the instant case reconciliation is possible and meaning can be given to the conflicting entries by harmonizing them, the entries of "powdered bones" in Schedules II and III cannot be struck down by reference to the entry of "fertilizer" in Schedule I, even assuming that the latter is the leading entry.
10. There is yet another reason to support the conclusion reached by us. Entry No. 22 of Schedule I was amended by the Madhya Pradesh Amendment Act No. 16 of 1966. The amended entry reads as follows :
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The amendment makes it clear that powdered and crushed bones which come under Schedules II and III are not included in the entry relating to fertilizer. Although a later Act is not generally used for construing an earlier Act, in cases the earlier Act is ambiguous the later Act can be seen for clarifying the ambiguity : Ram Krishna v. Janpad Sabha A.I.R. 1962 S.C. 1073 at 1079. The Amending Act No. 16 of 1966 by which powdered and crushed bones are specifically excluded from entry No. 22 of Schedule I clarifies the ambiguity which existed in this entry as it originally stood. The amending Act thus supports the meaning that we have given to entry No. 22 of Schedule I as it stood before the amendment.
11. It was next contended by the learned counsel for the petitioner that the entries of "powdered bones" in Schedules II and III should be limited to powdered bones which are not fertilizer. It was submitted that powdered bones can be divided into two categories: (1) powdered bones which are fertilizer and (2) other powdered bones. On this premise it was argued that only the latter category is included in the entries of powdered bones in Schedules II and III as the former category is covered fully by the entry of fertilizer in Schedule I. In this connection we were referred to the definition of fertilizer given in the Fertilizer (Control) Order, 1957, made by the Central Government in exercise of the powers conferred by Section 3 of the Essential Commodities Act, 1955.
12. Fertilizer, as defined in Section 2(d) of the Fertilizer (Control) Order, means any substance used or intended to be used as a fertilizer of the soil and specified in column 1 of the schedule and includes a mixture of fertilizer and a special mixture of fertilizers. Schedule I of this Order in entries 11 and 12 specifies bone-meal raw and bone-meal steamed in column 1. Bone-meal raw and bone-meal steamed, therefore, are fertilizers as defined in the Act. The second column of the schedule specifies the standard of fertilizer. In case of bone-meal raw, the following standard is prescribed :
(i) Moisture, per cent, by weight maximum 8.0.
(ii) Total phosphates (as P2 O6), per cent by weight, minimum 20.0.
(iii) Available phosphates (as P3 O5) soluble 2 per cent, citric acid solution, per cent, by weight, minimum 8.0.
(iv) Nitrogen, per cent by weight, minimum 3.0.
The material shall pass wholly through Is Sieve 240 (aperture 2399 microns) of which not less than 70 per cent shall pass through Is Sieve 80 (aperture 790 microns).
The prescription of standard in Schedule I is with reference to Section 13 of the Order which prohibits manufacture for sale, offer for sale, etc., of any fertilizer which is not of the prescribed standard. Bone-meal which is not of the prescribed standard as given in the schedule would still be a fertilizer, although the person selling it or manufacturing it for sale would be liable to punishment for contravention of the Order. The standard prescribed in Schedule I is, therefore, not relevant for construing the competing entries in the Sales Tax Act.
13. Four commercial products are obtained by crushing bones in bone crushing mills. These products are : (1) Bone sinews, (2) Crushed bones, (3) Bone grists and (4) Bone-meal. Useful information on this point is available from the report of the marketing of bones and bone-meal in India issued by the Directorate of Marketing and Inspection, Ministry of Food and Agriculture, Government of India. The characteristics of these products as given in this report are as follows:
Bone sinews.-These are the fibrous and tendinous portions adhering to bones. These are obtained as by-products from the bone crushing mills and contain a high percentage of nitrogen and phosphates. The glue-making industry in India uses only a small proportion of the sinews produced, the rest being exported. Bone sinews are also being used as fertilizer for paddy fields in South India and when needed for this purpose the sinews are further powdered by re-crushing.(P. 13).
Crushed bones.-These are small pieces of bones less than 2 inches in length but not smaller than 3/16th inch. Crushed bones are mainly exported and find a ready market abroad for use as raw material in the manufacture of glue and gelatine. These industries are not developed to any appreciable extent in India. According to the trade there are no factories in India that produce bone glue of proper quality. In India generally glue is manufactured on cottage industry scale from hide fleshings and trimmings and bone sinews. (P. 14).
Bone grists.-These are crushed bones of a smaller size, i. e., less than 3/16 inch but more than 3/32 inch. Bone grist is mostly exported and the principal importing country is Ceylon where it is used as a fertilizer. A very small quantity of grist is put to use in India by engineering firms for case hardening of steel. (P. 14).
Bone-meal.--This is obtained as a powder on crushing of bones and can pass through 3/32 inch mesh. There are some mills particularly those situated in South India that crush all bones into bone-meal by re-crushing the crushed bones and grists. Bone-meal finds use only to the country as export of it is totally banned. It is used as a fertilizer both by itself and also in fertilizer mixtures.(P. 14).
The following extract from the Standard Cyclopedia of Modern Agriculture, Vol. II, (P. 185) is also useful:
Bone-meals and bone-dusts.-With modern machinery bones can be ground to any required degree of fineness, though it of course costs a little more to grind bones finely than to turn them out in a rough state. Old customs die hard, and as farmers have long been accustomed to purchase bone manures in a state in which there are pieces of bone large enough to be easily recognised by the eyes as bone, they are suspicious of anything which is so finely ground as not to show such pieces. The popular bone-meals and bone-dusts of commerce are in this State. In these manures a variable proportion of the bone is really ground to the state of a fine dust or flour, but a certain amount still remains in pieces from 1/10 to 1/4 in., or even more, in diameter. Such coarse pieces are too slow in action to be really of much value as manure. The writer has tested a great many commercial samples of bone-meal and bone-dust over a wire sieve with ten meshes per linear inch. As a rule, from 5 to 20 per cent of the manure failed to pass such a sieve. Exceptional samples entirely passed through the sieve, but these are rarer than coarse samples, of which over 20 per cent failed to pass. What are known as bone-dusts generally contain more of the coarse particles than bone-meals.
14. The above information will show that all crushed bones of a size less than 3/23 inch fall under the description of bone-meal. This makes it clear that all powdered bones properly so called can be described as bone-meal and used as fertilizer. The difference only is this that if the powder is coarse it is slow to act; its value as manure increases with the degree of fineness to which it is ground. But it is quite clear that it would be wholly artificial to divide powdered bones as suggested by the petitioner's learned counsel into two categories, viz., (I) powdered bones which are fertilizer and (2) other powdered bones. The first category itself is so wide as to include all powdered bones properly so-called leaving nothing to come within the second category. Indeed, when we put it to the learned counsel that the premise that powdered bones are divisible into two categories on which he built his second contention is entirely unreal, all that he could say was that this was his alternative contention. If we accept this alternative contention of restricting the entries of powdered bones in Schedules II and III of the Act to powdered bones which are not fertilizer, we would be taking out everything from these entries leaving nothing on which they could operate and we would be virtually striking off the words "powdered bones" from these entries. This is not harmonious construction, for it reduces one of the competing entries to a dead letter. The only manner in which the competing entries can be harmonised is by restricting the entry of "fertilizer" in Schedule I by excluding from its ambit "powdered bones". Therefore, the second contention raised by the learned counsel for the petitioner must also fail.
15. In Commissioner of Sales Tax v. Sugar Bone Mills, Sagar : No. 1 [1966] 18 S.T.C. 338, the Division Bench, by applying the rule of harmonious construction, held that bone-meal will be excluded from entry No. 22 in Schedule I and will be included in entry No. 9 of Schedule II and entry No. 2 of Schedule III. We agree with this conclusion.
16. The petition fails and is dismissed. There will, however, be no order as to costs. The amount of security deposit shall be refunded to the petitioner. Petition dismissed.
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