Exemption for pasteurised milk extended to skimmed milk powder because it retains the essential character of milk.

Skimmed milk powder sold by the assessee was treated as falling within the exemption granted for sale of pasteurised milk under the relevant Government Order. The Court reasoned that milk powder is only milk in dehydrated form, produced for preservation, and therefore retains the essential character of milk for exemption purposes. That construction was also consistent with the object of the exemption. On that basis, the levy on the turnover of skimmed milk powder was held unsustainable.

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Issues: Whether skimmed milk powder sold by the assessee was covered by the exemption granted for sale of pasteurised milk under the Government Order issued under section 9 of the Andhra Pradesh General Sales Tax Act, 1957.

Analysis: The exemption was granted for sale of pasteurised milk. The assessee sold skimmed milk powder for the relevant assessment years, and the question was whether that product was different from milk for the purpose of levy. The Court held that milk powder is only milk in dehydrated form, prepared because milk cannot be preserved for long periods, and therefore retains the essential character of pasteurised milk. The construction adopted also advanced the object of the exemption.

Conclusion: Skimmed milk powder was held to fall within the exemption for pasteurised milk and the levy on its turnover was not sustainable.

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