Concessional sales tax withdrawal upheld for beedi leaves as the notification power under the taxing statute was found valid.

Section 5-B of the Andhra Pradesh General Sales Tax Act was interpreted as a whole to permit concessional tax only in the stated circumstances and to authorise the Government to notify goods excluded from the concession. The Court treated that notification power as operative, not redundant, and held that placing beedi leaves in the negative list was within the statutory scheme. The discrimination challenge also failed, because withdrawal of the concession was considered a permissible classification under the recognised taxing power. The Government Order was upheld and the writ petitions were dismissed.

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Issues: Whether the Government Order withdrawing concessional sales tax treatment for beedi leaves under section 5-B of the Andhra Pradesh General Sales Tax Act, 1957 was ultra vires or discriminatory.

Analysis: Section 5-B(1) was read as a whole to mean that concessional tax applies in the two stated circumstances, and that the Government is also empowered to notify goods not eligible for concessional rate under that section. The words conferring power to notify ineligible goods were held to be operative and not redundant, so the Government Order placing beedi leaves in the negative list was within the statutory scheme. The challenge based on discrimination was also repelled, as the classification and withdrawal of concession were treated as permissible in view of the legislative power recognised in the cited precedents.

Conclusion: The Government Order was upheld and the writ petitions were dismissed.

Ratio Decidendi: Where a taxing provision expressly authorises the Government to notify goods not eligible for concessional rate, that power includes the authority to withdraw the concession from specified goods, and such notification is not invalid merely because the goods may otherwise be used as raw material.

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