Industrial policy limits on sales tax exemption do not extend to purchase tax under the taxing statute.

A delegated exemption notification under the Karnataka Sales Tax Act was held to align with the 1993-98 industrial policy because the policy's references to "sales tax exemption" and "sales tax deferral" were confined to tax on sales turnover. The policy did not extend to distinct levies under the Act such as purchase tax, and the statutory definition of "tax" could not broaden that policy language. The notification exempting tax on goods manufactured and sold by a new industrial unit therefore implemented, rather than contradicted, the policy, and exemption from purchase tax on raw materials purchased from unregistered dealers was not available.

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Issues: Whether the notification issued under section 8A(1) of the Karnataka Sales Tax Act, 1957, which granted exemption in respect of goods manufactured and sold by new industrial units, was inconsistent with the State Government's industrial policy of 1993-98 so as to extend the exemption to purchase tax as well.

Analysis: The industrial policy used the expressions "sales tax exemption" and "sales tax deferral" in the context of KST/CST incentives. Read in that setting, the expressions referred to tax on sales turnover and not to every levy under the Act. The Act contained separate charging provisions, including levy on sales, purchase tax, and other turnovers, and the definition of "tax" in the Act could not be used to enlarge the scope of the policy language. The notification, which exempted tax payable on goods manufactured and sold by a new industrial unit, therefore carried out the policy rather than contradicting it. Since the policy did not confer a general exemption from all taxes under the Act, the petitioners could not claim exemption from purchase tax on raw materials purchased from unregistered dealers.

Conclusion: The notification was not repugnant to the industrial policy, and the petitioners were not entitled to exemption from purchase tax.

Ratio Decidendi: A delegated exemption notification must conform to the industrial policy, but where the policy expressly grants only sales tax exemption or deferral, it cannot be expanded to cover purchase tax or other distinct levies under the taxing statute.

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