Purposive reading of exemption entry upheld for liquor sales to defence organisations where military personnel bore the burden.

An exemption entry for sales of goods to military personnel by defence service installations was construed purposively to cover sales of Indian-made foreign liquor to defence personnel and defence organisations where the burden ultimately fell on military personnel. The Tribunal's view was accepted because the exemption could not be denied merely due to the immediate buyer being a defence organisation, and later governmental clarification in the finance department notification supported that legislative understanding. The disputed sales were therefore treated as exempt, and no basis remained to interfere with the Tribunal's conclusion.

---

---

Issues: Whether sales of Indian-made foreign liquor to defence personnel and defence organisations could be treated as exempt under the tax-free entry relating to sale of goods to military personnel by defence service installations.

Analysis: The entry in the tax-free Schedule exempted sale of goods to military personnel by defence service installations. The Tribunal's view that the exemption should not be denied merely because the immediate sales were made to defence organisations, where the ultimate burden would fall on military personnel, was accepted. The interpretation was also supported by the later governmental clarification inserted in the finance department notification referred to in the judgment, which reflected the same legislative understanding of the exemption entry.

Conclusion: The question was answered in favour of the assessee, and the sales were held exempt.

Final Conclusion: The revision failed because the exemption entry was construed to cover the disputed transactions, leaving no basis to interfere with the Tribunal's view.

Ratio Decidendi: An exemption entry for sales to military personnel by defence service installations may be construed purposively to extend to the disputed supply chain where the legislative intent and subsequent clarification support the exemption.

---