JUDGMENT

Bhan, J. — The appellant is a public limited company and a dealer registered under the Karnataka Tax on Entry of Goods Act, 1979 (hereinafter referred to as "the Entry Tax Act"). It is engaged in the manufacture of tyres of two wheeler motor vehicles. Appellant is located in Metagalli in Mysore and Metagalli is a local area within the definition of Local area in Section 2 (A) (5) of the Entry Tax Act. The main input in the manufacture of tyres is rubber which the appellant procures from the neighbouring State of Kerala.

2. Sub-section (1) of section 3 of Entry Tax Act prescribes that there shall be levied and collected tax on entry of any goods specified in the First Schedule into a local area for consumption, use or sale therein, at such rates not exceeding 5% of the value of the goods, as may be specified retrospectively or prospectively, by the State Government by issuance of Notifications. Section 2 of the Entry Tax Act defines the various expressions used in the Act. The expression Agriculture produce or horticulture produce is defined in section 2 (A) (1). In substance, it includes all agriculture or horticulture produce excluding tea, coffee, rubber, cashew, cardamo