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of <h1>Court dismisses challenge to Sales Tax Commissioner's order on eatables tax exemption; ruling emphasizes strict interpretation of exemption laws.</h1> The court dismissed the petitioners' applications challenging the Sales Tax Commissioner's order directing the levy of tax on certain eatables. The court ... - Issues: Validity of provision in Hyderabad Sales Tax Act; Interpretation of exempted goods under Section 2(f); Application of Article 286(3) of the Constitution of India.Validity of Provision in Hyderabad Sales Tax Act:The judgment addresses the validity of a provision in the Hyderabad Sales Tax Act. The petitioners, who are hotel proprietors, sought writs of certiorari to challenge the Sales Tax Commissioner's order directing the levy of tax on certain eatables. The Act, passed in 1950, exempts certain goods from sales tax, with a list provided in Schedule I under Section 2(f). The petitioners argued that the list is not exhaustive, contending that items like rice and flour, exempted from tax, should extend to products like idlies and dosas or biscuits and pastries, respectively. However, the court emphasized that exemption under sales tax must be strictly construed and cannot be extended through analogy. The petitioners failed to demonstrate that the items they claimed exemption for fell under the exempted articles listed in the Act, leading to the dismissal of their applications for writs of certiorari.Interpretation of Exempted Goods under Section 2(f):The court delved into the interpretation of exempted goods under Section 2(f) of the Hyderabad Sales Tax Act. The petitioners argued that items like rice and flour, exempted from sales tax, should cover derivative products like idlies, dosas, biscuits, and pastries. However, the court stressed that unless the petitioners could establish that the products in question fell under the specific exempted articles listed in the Act, they were not entitled to exemption. The principle of strict construction of sales tax exemptions was highlighted, emphasizing that analogical reasoning cannot be used to claim exemption where not explicitly provided for in the statute.Application of Article 286(3) of the Constitution of India:The judgment also analyzed the application of Article 286(3) of the Constitution of India concerning the imposition of tax on essential goods. The petitioners argued that the Essential Supplies Temporary Powers Act, which includes food-stuffs as essential commodities, prohibited the State Legislature from levying tax on such commodities. However, the court clarified that the Essential Supplies Temporary Powers Act pertains to the regulation and control of essential commodities, distinct from the prohibition under Article 286(3) against taxing goods essential for the community's life. The court emphasized that unless Parliament explicitly declares a commodity essential for the community, the State Legislature is not barred from levying tax on it. Consequently, the court rejected the petitioners' argument that the items they sought tax exemption for were essential goods under Article 286(3), leading to the dismissal of their applications.
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