Common parlance classification governs tax treatment, while employee-assisted preparation can still satisfy an exemption notification.

The expression "prepared by themselves" in the exemption notification was construed in its plain and contextual sense, and it was not limited to goods prepared only by the dealer's own hand. Deshi-sweetmeats and namkins prepared with the assistance of employees therefore remained within the higher turnover exemption. For tax classification, fried and salted groundnuts were tested by common parlance and commercial understanding; as processed goods no longer ordinarily treated as oil-seeds for oil extraction, they lost that character and became taxable. The revision thus succeeded on the first issue and failed on the second, leading to partial relief and rectification of the assessments.

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Issues: (i) Whether dealers in deshi-sweetmeats and namkins were entitled to the higher turnover exemption under the notification where the goods were prepared with the help of employees. (ii) Whether fried and salted groundnuts retained the character of oil-seeds so as to remain exempt from tax.

Issue (i): Whether dealers in deshi-sweetmeats and namkins were entitled to the higher turnover exemption under the notification where the goods were prepared with the help of employees.

Analysis: The expression "prepared by themselves" in the notification was construed in its plain sense and in the context of the scheme of the exemption. The absence of restrictive words requiring personal preparation showed that the benefit was not confined to articles prepared only by the dealer's own hand and could extend to goods prepared with the assistance of employees.

Conclusion: The issue was decided in favour of the assessee and against the Revenue.

Issue (ii): Whether fried and salted groundnuts retained the character of oil-seeds so as to remain exempt from tax.

Analysis: Classification for tax purposes was held to depend on the common parlance or commercial understanding of the commodity. Applying that test, fried and salted groundnuts were found to have lost their oil-seed character, since they were not ordinarily treated in trade as seeds meant principally for extraction of oil and their character had materially changed by processing.

Conclusion: The issue was decided in favour of the Revenue and against the assessee.

Final Conclusion: The revision succeeded only on the first issue and failed on the second, resulting in partial relief to the assessee and consequential rectification of the assessments.

Ratio Decidendi: For tax classification, commodities must be understood in their common parlance or commercial sense, and an exemption notification using the words "prepared by themselves" does not necessarily exclude preparation with employee assistance unless the language expressly does so.

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