1999 PLP (Trib (PTD)

Shop is a place kept and used for the sale of goods. A shop is a building in which goods are sold. Premises were not a 'shop' if the business carried on was not 'wholly' or mainly for the purposes of a retail trade or business. A tavern would not come within the definition of 'shop'. The definition of shop as above, clearly shows that running a school does not fall within the term 'shop' to be covered under the aforesaid notification/Circular of the C.B.R. is such, the treatment of the learned A.O. in refusing exemption to the appellant for the building used for running a school in it as a business 'shop' was justified."

5. It is submitted on behalf of the appellant at the outset that it is well settled that C.B.R. Circulars explaining/interpreting the provisions of law are not binding upon the Assessing Officers. The learned counsel has further submitted that in the immediately preceding year the same learned C.W.T.(A) while deciding the Appeal No. 1215/V on 24-11-1997 held: "In respect of the commercial properties, which is partly commercial and partly residential, the owner of the self-occupied residential portion may opt for exclusion of the value of that portion from his non-agricultural assets under clause (xvi) of subsection (1) of section 5 of the Act. As the assessee had opted for exclusion of the self-occupied portion, the A.O. should have, therefore, allowed it by excluding it from valuation. Similarly, as an assessee has also been granted exemption vide the Circular dated 2-9-1996, in respect of one shop owned and occupied by an assessee for his own business, therefore, one shop in this case is the office occupied by the Headmaster or Principal or Administrator or whatever it may be called is to be allowed exemption in view of the aforesaid Circular, if the income of the school is being assessed to tax and the school has not claimed exemption under clause (86) of the Second Schedule. The assessment order is, therefore, set aside for fresh decision in line with the aforesaid Circular after opportunity. "

6. The next submission of the learned counsel of the appellant is that the learned C.W.T.(A) has misdirected himself in holding that the school building. (supra) is partly self-occupied in the instant year under appeal. He has submitted that the learned C,W.T.(A) has himself recorded in his impugned order that the appellant has shifted his residence to the newly purchased house in January, 1997 and on the corresponding valuation date the asset is being exclusively used as a shop for rendering instructional services against the fees charged from the customer-students.

7. Regarding the import of the word "shop", the learned counsel has submitted that the learned C.W.T.(A) is not justified in referring to the Concise Oxford Dictionary instead of referring to the exhaustive standard dictionaries e.g. Webster New Lexicon etc. The learned D.R. is supporting the impugned orders.

8. We have given our careful consideration to the facts and circumstances of the case as well as the submission of the learned representatives of the two parties (supra). We find that the word "shop", as per Webster's New World Dictionary of the American Language, Second College Edition, published by New World Dictionaries/Simon and Shuster, A Division of Simon & Shuster Inc. Rockefeller Centre, 1230 Avenue of the Americas New York, N.Y. 10020-1984, at page 1316, means: " 1(a) a place where certain goods or services are offered for sale; (b) a specialised department in a large store (the gournut shop) 2 a place where a particular kind of work is done (a printing shop) 3 in some schools, a manual training course, a class or department. "

9. According to the New Shorter Oxford English Dictionary, 1993 Edn., at pages 2835 and 2836, Volume 11, the word "shop" means: "

1. A house or building where goods are made or prepared for sale and sold. ME.

2. A building, room, or other establishment used for the retail sale of merchandise or services. Also, the contents of a shop, the merchandise itself. Also as int., used to summon a shop assistant. LME. b An act of shopping for purchases. colloq.M20. 3a A building or room equipped and used for a particular craft or manufacturing industry; a workshop, freq. as opp. to an office. Now also (spec), a room or department in a factory where a particular stage of production is carried out. LME. b fig. A place, bodily organ, etc., where something is produced or where some process is carried gut. M 16-M 18. c In glass-manufacturing, a team of workers. L19. d A school room equipped for teaching skills for use in a workshop; this study as a class room discipline."

10. Coming to Aiyar's Law Lexicon referred to by the learned C.W.T.(A) (supra), ordinary meanings of the word and other authorities quoted by him on the same page are: "SHOP AND STALL. 'Shop' is an English word meaning the building itself, as distinguished from a place of sale which is open like a stall. (27 NW 586). SHOP AND STORE. 'Shop' ordinarily means a place in which a mechanic pursues his trade, as a carpenter shop, blacksmith shop, or shoemaker's shop. It is not the legal equivalent of 'store', as used in a statute making it an offence to keep a store open on Sunday. (25 Am. Rep. 643). The words 'store' and 'shop' may be used interchangeably, so that a butcher shop is a 'store', within the meaning of a statute prohibiting the keeping open of a store on Sunday. (58 Ark. 1). The word 'shop' in its ordinary meaning denotes a building which is primarily used by buying and selling goods. (69 PR 1915--31 IC 191, See also 15 Born. 530). 'Shop' means a place where the trading activities connected with the buying and selling of goods are carried on, negotiations of the terms of sale, carrying on of the survey of the goods, imported, arranging for the delivery of the goods sold, collection of the price of the goods sold etc. being trading activities. It is not necessary that the delivery of the goods should take place at the premises of the business to constitution the premises as 'shop! M/s. International Ore and Fertilizers (India (P) Ltd. v. E.S.I. Corporation. AIR 1988 SC 79, 81 (Employees State Insurance Act (34 of 1948), S.1(5), A.P. Government Notification in G.O. Ms. No.297, dated 25-3-1975). 'Shop' means a building used for the carrying of any retail trade or retail business wherein the primary purpose is the selling of goods by retail and includes a building used for the purposes of a hairdresser, undertaken of ticket agency or for the reception of goods to be washed, cleaned or repaired, Horwitz v. Rowson, (1960) 2 All ER 881, 885 (QBD), (Town and Country Planning (Uses Classes) Order, 1950 Art.2(2). A shop must be 'something more than a mere place for sale; it imports a place for storing also, where the commodities admit of storing' (per Meller, J., Pope v. Whalley, 34 LJMC 80). The place where a person carries on stevedoring, clearing and forwarding operations is a shop. M/s. Cochin Shipping Co. v. E.S.I. Corporation, AIR 1993 SC 252, 258 (Employees State Insurance Corporation Act (64 of 1948), section 1(5) Notification, dated. 18-9-1974 Entry(v)."

11. Thus, we find that the word "shop" means a building where goods or services are sold on retail basis i.e. directly sold to the consumers and it is even literally employed to describe, in a school a manual training course, school room equipped for teaching skills for use in a workshop, study as a class room discipline and a class or department. It, therefore, follows that a building owned and. used by a person for running a school, to offer instructional services to the seekers of knowledge and skills against monetary consideration, qualifies for exemption from tax under clause (12)(2) of the Second Schedule (ibid), as a shop owned and occupied by the appellant for the purposes of his own business.

12. Accordingly, the impugned orders of the two learned officers below are found sustainable both on facts as well as in law; hence set aside with the directions to allow the exemption from charge of wealth tax claimed on the impugned school building.

13. The appeal is allowed. C.M.A./52/(Trib.) Appeal allowed