Broad construction of exemption entries extends "cereals in all forms" to maida and maida-based vermicelli.

A sales tax exemption entry covering "cereals and pulses in all forms" was construed broadly by reference to statutory history and the ordinary meaning of cereal. The phrase "in all forms" was held not to be limited to raw or merely husked grain, but to extend to commercially prepared products that retain the essential identity of the original cereal. On that basis, maida was treated as a form of cereal, and shevaya or vermicelli made from maida, without change in chemical composition, was also covered by the exempt entry. The Revenue's narrower classification was rejected, and the exemption was applied to both goods.

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Issues: Whether maida is a form of cereal within entry 10 of Schedule A to the Bombay Sales Tax Act, 1959, and whether shevaya or vermicelli prepared from maida is covered by the expression "cereals and pulses in all forms" in that entry.

Analysis: The entry was construed in the light of the statutory history, which showed that the legislature had moved from an exemption of cereals and pulses with a separate exemption for flour to a combined exemption covering cereals and pulses in all forms and flour prepared therefrom. The phrase "in all forms" was held not to be confined to mere varieties or conditions such as husked or unhusked grain, but to extend to commercially prepared forms that retain the essential character of the cereal. The Court distinguished cases where the goods had become distinct commercial commodities for the purpose of a different taxing scheme, and relied on the ordinary and dictionary sense of "cereal" as including commercially prepared grain products. Since maida was accepted as a form of cereal and shevaya was merely maida converted into slender dried threads without change in chemical composition, shevaya remained within the exempt entry.

Conclusion: Both maida and shevaya fell within entry 10 of Schedule A, and the questions were answered in the affirmative, against the Revenue.

Final Conclusion: The exemption entry was given a broad, substance-based construction, and the taxable classification adopted by the Revenue was rejected.

Ratio Decidendi: Where a sales tax exemption entry covers goods "in all forms", it extends to commercially prepared forms that do not lose the essential identity of the original commodity, and the phrase is not confined to mere varieties or physical conditions of the article.

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