Craft paper held to be paper, not packing material, denying exemption under the trade tax notification.

Craft paper was treated as "paper" under common parlance and commercial understanding because the term was not defined in the Act or notifications, and paper may include material used for writing, printing, wrapping and packing. The Court held that a product does not stop being paper merely because it can also serve packing purposes, but the notification's exclusion for units manufacturing paper had to be given full effect. On that basis, craft paper could not be reclassified as packing material to claim recognition certificate benefits and exemption, and the challenge to the amendment proceedings failed.

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Issues: Whether craft paper manufactured by the petitioner was "paper" or "packing material" for the purpose of entitlement to recognition certificate and exemption under the notification issued under section 4-B of the U.P. Trade Tax Act, 1948.

Analysis: The expression "paper" was not defined in the Act or the notifications, so its meaning had to be gathered from common parlance and commercial understanding. On that approach, paper includes material used for writing, printing, wrapping, packing and related purposes. The Court distinguished cases involving products that were not merely paper but composite packing articles, and accepted the view that a product does not cease to be paper merely because it can also be used for packing. The exclusion in the notification for units engaged in the manufacture of paper had to be given full effect, and a manufacturer of craft paper could not claim exemption by characterising the product as packing material.

Conclusion: Craft paper manufactured by the petitioner was held to be paper and not packing material. The challenge to the notice and proceedings for amendment of the recognition certificate failed, and the writ petition was dismissed.

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