1974 (12) TMI 67 - HC - Central Excise

Summary

Issues:
1. Interpretation of the definition of "tobacco" under the Sales Tax Act after an amendment.
2. Whether tobacco seeds are exempt from tax under the Sales Tax Act.

Analysis:
The judgment pertains to a writ petition under the Andhra Pradesh General Sales Tax Act, 1957, involving the interpretation of the term "tobacco" post an amendment. The petitioners, registered dealers under the Sales Tax Act, challenged the levy of tax on tobacco seeds, claiming exemption based on the previous court decision and the definition of "tobacco products." The court previously held that tobacco seeds fall under the exempted category of "tobacco products." However, the State Government later amended the Act, substituting the term "tobacco" for "tobacco and all its products" in the Schedule. The crux of the issue lies in determining whether tobacco seeds are included in the definition of "tobacco" post-amendment to claim exemption from tax.

The crux of the argument revolves around the interpretation of the definition of "tobacco" as provided in the Central Excises and Salt Act, 1944, which was adopted for the Sales Tax Act. The petitioners argue that the definition is illustrative and not exhaustive, encompassing all parts of a tobacco plant once detached from the earth, including tobacco seeds. On the contrary, the Government's counsel contends that the amended definition of "tobacco" excludes tobacco seeds from exemption, emphasizing that the legislative intent was to exclude tobacco products like seeds from tax exemption post the court's decision.

The court delves into the legislative intent behind the amendment, highlighting the inclusive nature of the definition of "tobacco." The definition includes any form of tobacco, along with leaves, stalks, and stems of the tobacco plant. The court opines that the definition is not exhaustive, and the term "tobacco" should be interpreted broadly to encompass all parts of the plant once detached from the earth. By adopting an inclusive approach, the court concludes that tobacco seeds should be considered part of the definition and, therefore, exempt from tax under the Sales Tax Act.

In light of the comprehensive analysis of the definition of "tobacco" and the legislative intent behind the amendment, the court rules in favor of the petitioners, holding that tobacco seeds are included in the definition of "tobacco" and are thus exempt from tax. The writ petition is allowed, with costs imposed on the opposing party.