Plain meaning of exemption notification: "drinks" includes alcoholic beverages, and schedule entries cannot narrow the exemption.

The expression "drinks" in a tourism-related sales tax exemption notification was construed by its plain and commercial meaning, so it included alcoholic beverages as well as non-alcoholic beverages. The revisional authority's attempt to restrict the term by reference to the Second Schedule to the Karnataka Sales Tax Act was rejected because schedule entries cannot narrow the unqualified language of an exemption notification. The earlier tourism policy and notification governed the claim, and the revised policy was held inapplicable. The result was that exemption could not be denied on sales of Indian-made liquor and beer under the notification.

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Issues: Whether the expression "drinks" in the sales tax exemption notification issued under the tourism policy includes alcoholic beverages, and whether the revisional authority was justified in restricting it to non-alcoholic drinks by reference to the Second Schedule to the Karnataka Sales Tax Act, 1957.

Analysis: The exemption notification issued under section 8-A(1) of the Karnataka Sales Tax Act, 1957 granted relief on sale of "food and drinks" by new tourism units. The later revised tourism policy was held inapplicable to the assessee, so the earlier policy and notification governed the claim. The revisional authority had relied on Entry 8 of Part F of the Second Schedule, which refers to "food and non-alcoholic drinks", and on Entry 6 of Part L dealing with liquor, to confine the exemption to non-alcoholic beverages. That approach was rejected because schedules are not the source of substantive exemption language and cannot control the plain words of the notification. In construing a fiscal exemption, the words used in the notification must be given their natural meaning. On ordinary and commercial understanding, "drinks" includes alcoholic beverages as well as non-alcoholic beverages.

Conclusion: "Drinks" in the exemption notification includes alcoholic beverages. The revisional authority was not justified in denying exemption on sales of IML and beer.

Ratio Decidendi: An exemption notification in a fiscal statute must be construed on the plain and natural meaning of its words, and a schedule used for classification of taxable goods cannot be imported to narrow an unqualified exempting expression.

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