Exemption for goods made from taxed plastic inputs continued despite later schedule changes, defeating the sales tax demand.

Taxed plastics used as manufacturing inputs remained eligible for exemption under the Government order issued under section 9(1) of the Andhra Pradesh General Sales Tax Act, 1957, because the order was specific and extended to all purchases of plastics for manufacture. The later substitution of entry 19 did not override the exemption already granted, and the separate later treatment of plastic and polythene bags in the schedule supported that the concession continued for goods made from such taxed plastic inputs. The tax demand on the manufactured bags and containers was therefore unsustainable.

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Issues: Whether polythene bags and plastic containers manufactured from plastics that had already suffered tax were entitled to exemption from sales tax under the Government order issued under section 9(1) of the Andhra Pradesh General Sales Tax Act, 1957.

Analysis: The Government order was held to be specific and applicable to all purchases of plastics used for manufacture, and the respondent had purchased taxed plastics and used them for manufacture. The later substitution of entry 19 did not displace the exemption already granted under the Government order. The reasoning also noted that plastic bags and polythene bags were subsequently separately dealt with in the schedule, which reinforced that the exemption on the taxed plastic input continued to apply to goods manufactured from such plastic.

Conclusion: The exemption was available and the tax demand could not be sustained against the assessee.

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