Strict construction of tax concessions bars purchasing dealers from claiming section 5-A benefit on bauxite ore purchases.

A concessional tax provision must be applied strictly according to its wording: under the relevant version of section 5-A of the Karnataka Sales Tax Act, the concession was available only for sale of industrial inputs by a registered dealer to another registered dealer on the prescribed declaration, and not to the purchasing dealer. Because the assessee bought bauxite ore for use as raw material and the goods fell within the Third Schedule, the levy on purchase turnover did not qualify for the concession under section 5-A. The later substitution of section 5-A from 1 April 2002, which expressly extended the benefit to purchases, did not apply to earlier assessment years.

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Issues: Whether the assessee, as a purchasing dealer, was entitled to the concessional rate of tax under section 5-A of the Karnataka Sales Tax Act, 1957 on its purchase turnover of bauxite ore used as raw material in the manufacture of cement during the relevant assessment years.

Analysis: The provision as it stood during the relevant period granted the concessional rate only in respect of sale of industrial inputs by a registered dealer to another registered dealer, subject to the prescribed declaration. On its plain wording, the benefit was confined to the selling dealer and did not extend to the purchasing dealer. The goods in question also fell within the Third Schedule and the relevant levy was on purchase turnover under section 5(3)(b), not under the concessional scheme in section 5-A. The later substitution of section 5-A with effect from 1 April 2002, which expressly extended the benefit to purchases, did not govern the earlier assessment years.

Conclusion: The assessee was not entitled to the concessional rate of tax under section 5-A on the purchase turnover of bauxite ore for the assessment years in question.

Ratio Decidendi: A taxing provision granting a concessional rate must be applied according to its plain language, and where the relevant version of the statute confines the concession to sales by the dealer, it cannot be extended to a purchasing dealer by interpretation.

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