Popular market meaning governed classification of mori basudi, placing it in the sweets and sweetmeats entry, not the milk exemption.

Taxing and exemption entries must be construed in their ordinary popular sense as understood by the buying public and trade. Applying that test, mori basudi was treated and sold as a sweet made from milk, not as milk itself. Its commercial identity, fat content, price and market understanding showed it to be a distinct commodity. The specific inclusion of basudi in the sweets and sweetmeats entry, together with the exclusion of mori basudi from the milk exemption, supported classification under entry 50 of Schedule II, Part A rather than the tax-free milk entry or the residuary entry.

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Issues: Whether mori basudi sold by the assessee was taxable under entry 50 of Schedule II, Part A to the Gujarat Sales Tax Act, 1969, or whether it fell within the tax-free entry for milk under entry 10 of Schedule I or the residuary entry of Schedule III.

Analysis: The expression used in a taxing or exemption entry must be understood in its ordinary popular sense, as known to the buying public and trade in the relevant area. On the facts, mori basudi was treated and sold as a sweet prepared from milk, not as milk itself. Its commercial identity, fat content, price and market understanding showed that it was a distinct commodity from milk. The Court also held that the specific inclusion of basudi in entry 50, together with the exclusion of mori basudi from entry 10, supported classification under the sweets and sweetmeats entry rather than the milk exemption or the residuary entry.

Conclusion: Mori basudi was correctly held taxable under entry 50 of Schedule II, Part A, and not covered by the tax-free milk entry or the residuary entry. The answer was therefore in favour of the Revenue.

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