Exemption for cereals and pulses does not cover rice milling when paddy and rice are separately classified by statute.

An exemption for processing of cereals and pulses was held not to extend to rice milling because the statutory scheme separately treated cereals, paddy and rice as distinct entries. The Court reasoned that where the Andhra Pradesh General Sales Tax Act, 1957 differentiates rice from cereals, the exemption in G.O. Ms. No. 2566 cannot be enlarged by the general meaning of cereals alone. Rice milling was therefore outside the exemption, and the tax liability remained undisturbed.

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Issues: Whether the exemption for processing of cereals and pulses extended to rice milling, and whether rice could be treated as covered by the relevant government order.

Analysis: The exemption under G.O. Ms. No. 2566 was confined to processing of cereals and pulses. The Court noted that the Third Schedule to the Andhra Pradesh General Sales Tax Act, 1957 separately listed cereals, paddy and rice as distinct entries. Once the statutory scheme specifically differentiated paddy and rice from cereals, the exemption could not be enlarged to include rice milling merely because rice may broadly fall within the general meaning of cereals.

Conclusion: Rice milling was not covered by the exemption, and the writ petitions failed.

Final Conclusion: The exemption was held inapplicable to the petitioners' activity, leaving the tax liability undisturbed.

Ratio Decidendi: Where a statute separately classifies paddy and rice from cereals, an exemption for processing of cereals and pulses cannot be extended to rice milling by general meaning alone.

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