Imported sugar exemption under sales tax law upheld where commodity description was not limited to domestic production.

Imported sugar was held to fall within the exemption entry in the Kerala General Sales Tax Act, 1963, because the Third Schedule used the Central Excises and Salt Act description only to identify the commodity. The incorporation was treated as limited and did not carry over any territorial restriction limiting sugar to domestic production. Applying strict construction of a fiscal exemption, the court refused to read additional words into the provision. Payment of customs tariff and additional excise duty on import did not alter the sales tax exemption analysis, so imported sugar was not liable to sales tax.

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Issues: Whether imported sugar fell within the exemption entry in the Kerala General Sales Tax Act, 1963 and was therefore not exigible to sales tax.

Analysis: The exemption entry for sugar in the Third Schedule to the Kerala General Sales Tax Act incorporated the description of sugar from the First Schedule to the Central Excises and Salt Act, 1944. That incorporation was treated as a limited legislative device to identify the commodity, not as a borrowing of the excise statute's territorial limitation. In a fiscal statute, the language had to be construed strictly, and no additional words could be read into the definition to confine it to sugar produced in India. The fact that customs tariff and additional excise duties had been paid on import did not alter the statutory exemption analysis under the sales tax law.

Conclusion: Imported sugar was covered by the exemption entry and was not liable to sales tax under the Kerala General Sales Tax Act, 1963.

Ratio Decidendi: Where a sales tax exemption entry incorporates a commodity description from another statute, the incorporation is confined to identifying the commodity and cannot be expanded by implication to import territorial restrictions not expressed in the taxing provision.

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