BHAGWATI, J. - The short question that arises on this reference is whether borders woven on handloom out of pure silk, art silk and jari thread are handloom cloth within the meaning of entry 29 in Schedule A of the Bombay Sales Tax Act, 1959. The assessees are dealers registered under the Act and they carry on business as manufacturers and dealers in all kinds of sarees, blouse pieces, borders etc. The assessees in the course of their business sold certain borders at the rate of Rs. 3.50 per yard under a bill No. 965 dated 11th August, 1961, and submitted an application to the Deputy Commissioner of Sales Tax under section 52 for determination of the tax payable on the sale of the borders. The borders were woven on handloom out of pure silk, art silk and jari thread and the proportion or pure silk was more than 60 per cent. It was contended before the Deputy Commissioner of Sales Tax that the borders were exempt from tax inasmuch as they were handloom cloth covered by entry 29 of Schedule A. The Deputy Commissioner of Sales Tax, however, took the view that borders though woven on handloom were not handloom cloth within the meaning of that expression as used in entry 29 of schedule A and were taxable under entry 9 of Schedule E. The assessees thereupon preferred an appeal before the Tribunal. The same contentions which were urged before the Deputy Commissioner of Sales Tax were repeated before the Tribunal. The Tribunal held that the borders were handloom cloth within the meaning or entry 29 of Schedule A and the sale of the borders was, therefore, exempt from tax. The State being aggrieved by this decision of the tribunal preferred an application for a reference and on the application the Tribunal referred the following two questions for the opinion of the Court :

"(1) Whether Indori borders containing more than 60 per cent. of pure silk and woven on handloom out of silk, art silk and jari threads are handloom cloth within the meaning of entry 29 in Schedule A to the Bombay Sales Tax Act, 1959 ?

(2) If the answer to question (1) above is in the affirmative, whether sale of such borders can be taxed as sale of goods falling within the ambit of entry 9 of Schedule E to the Bombay Sales Tax Act, 1959."

It will be seen from the frame of the questions that the second question would arise for consideration only if the first question is answered in favour of the assessee. But we may point out straightaway for reasons which will become apparent from what follows that if the borders can be said to be handloom cloth within the meaning of entry 29 of Schedule A, the sale of the borders would be exempt from tax and there would be no question of the State being entitled to tax the sale of the borders under entry 9 of Schedule E.

Schedule A contains entries specifying goods the sale or purchase of which is exempt from tax. This exemption is granted by section 5 which declares :

"(1) Notwithstanding anything in this Act, but subject to the conditions or exceptions (if any) set out against each of the goods specified in column 3 of Schedule A, no tax shall be payable on the sales or purchases of any goods specified in that Schedule.

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Entry 29 of Schedule A specifies the following class of goods as exempt fro tax :

"Handloom cloth of all varieties excluding pure silk cloth".

If, therefore, handloom borders fall within the expression "handloom cloth" as used in entry 29 of Schedule A, their sale or purchase would be exempt from tax notwithstanding that they fall within any entry in any of the other Schedules of the Act. As a matter of fact handloom borders of the type sold by the assessee would be covered by entry 9 of Schedule E which refers to the following class of goods :

"9. Braids, borders, laces and trimmings when sold by weight at a price of not less than fifty naye paise per tola or when sold by length at a price of not less than fifty naye paise per yard."

and prescribes