Common parlance test governs sales tax exemptions: khoya burfee qualifies as milk product, but muthri is not bread.

Sales tax classification under exemption entries was determined by common parlance and commercial understanding. Plain khoya burfee, being principally a milk-based sweet, was treated as a milk product and therefore fell within the relevant exemption entry, notwithstanding the addition of nuts or silver leaf; the later Delhi Sales Tax Act, 1975 did not alter the position for the period in question. Muthri, by contrast, was held not to be bread because bread is ordinarily baked and associated with bakery goods, while muthri is a fried item made by a halwai. The reference was answered partly for the dealer and partly for the department.

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Issues: (i) Whether burfee sold as plain khoya burfee was a "milk product" exempt under entry 12 of the Second Schedule to the Bengal Finance (Sales Tax) Act, 1941 as extended to Delhi; (ii) Whether muthri was "bread" exempt under entry 3 of the Second Schedule to the same Act.

Issue (i): Whether burfee sold as plain khoya burfee was a "milk product" exempt under entry 12 of the Second Schedule to the Bengal Finance (Sales Tax) Act, 1941 as extended to Delhi.

Analysis: Classification of items in sales tax entries must be determined according to common parlance and commercial understanding. Applying the earlier binding view that ice cream could be treated as a milk product, plain burfee made from khoya and principally based on milk could not be excluded merely because nuts or silver leaf were added. The later change in the Delhi Sales Tax Act, 1975 did not affect the position for the period in question.

Conclusion: Burfee was held to be a milk product and the question was answered in favour of the dealer.

Issue (ii): Whether muthri was "bread" exempt under entry 3 of the Second Schedule to the Bengal Finance (Sales Tax) Act, 1941 as extended to Delhi.

Analysis: The term "bread" was construed in its ordinary and commercial sense. Bread is ordinarily baked, commonly associated with yeast and bakery sale, whereas muthri is a fried item made by a halwai. On that understanding, muthri could not be equated with bread.

Conclusion: Muthri was held not to be bread and the question was answered in favour of the department.

Final Conclusion: The reference was answered partly for the dealer and partly for the department, with exemption upheld for burfee but denied for muthri.

Ratio Decidendi: Fiscal entries are to be interpreted in their common and commercial sense, and an item is covered by an exemption entry only if it answers that description in ordinary trade parlance.

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