SHELAT, C.J. - These are two references, one at the instance of the assessees and the other at the instance of the State of Gujarat, arising out of a reference made to the Deputy Commissioner by the petitioners, Messrs Pravin Brothers, under section 52(e) of the Bombay Sales Tax Act, 1959. Since they involve the same facts, and arise out of the same order, they can be disposed of by a common judgment.

The petitioners in reference No. 8 of 1963 were at the material time dealers in embroidered cloth. On 1st December, 1960, they sold two embroidered sarees, each of five yards in length, for Rs. 12 and Rs. 10-8-0 respectively and they also sold a piece of embroidered cloth of three yards in length at the rate of Rs. 3-10-0 per yard. It is an admitted fact that the five yards pieces were cut from malmal and voil takas ands embroidery work was thereafter superimposed on them. The embroidered piece of three yards also was similarly prepared. The five yards pieces were intended to be used as sarees and the three yards pieces were meant for preparing ladies' underwear. The Deputy Commissioner held that sarees would be covered by entry 3(i) of Schedule E to the Act, as the said entry specifically refers to sarees which are embroidered. As regards the embroidered three yards piece was concerned, he held that there being no entry covering that item, the embroidered piece of cloth fell under entry 22 of Schedule E to the Act. On the matter being taken to the Tribunal in appeal the Tribunal confirmed the order of the Deputy Commissioner in so far as the sarees were concerned, but differed from the Deputy Commissioner in regard to the three yards embroidered piece meant for ladies' underwear, and held that that piece was covered by entry 4 of Schedule D to the Act, as contended by the petitioners. Both the parties being dissatisfied with the aforesaid judgment and order of the Tribunal, they applied for a reference to this Court and the Tribunal has referred to us the following questions for our answers :-

"(1) Whether on the facts and in the circumstances of the case the sales of embroidered pieces of cloth of 5 yards and 3 yards effected under the applicants' bill No. 290 dated 1st December, 1960, are exempt from tax under section 5(i) of the Bombay Sales Tax Act, 1959, as covered by entry 15 of Schedule A to the Act ?

(2) If not, whether the sales of the 5 yards pieces sold as embroidered sarees are covered by entry 4 in Schedule D to the Act and taxable at the rates shown against that entry ? and

(3) Whether on proper construction of entry 4 in Schedule D to the Bombay Sales Tax Act, 1959, the sale of embroidered piece of cloth made by original applicants M/s. Pravin Bros. under the bill No. 290 dated 1st December, 1960, is covered by the said entry or whether the same is covered by entry 22 in Schedule E to the Act or any other entry of the Schedules annexed to the Act ?"

It would appear that the course of business followed by the petitioners was that they used to purchase takas of malmal and voil cloth and in order to prepare sarees from out of them, they used to cut out five yards pieces out of those task and have embroidery work superimposed upon those pieces and then sell them as embroidered sarees. Similarly, they used to have three yards pieces cut out from those takas and have those pieces thereafter embroidered and then sell such embroidered pieces for ladies' underwear. On these facts, the Deputy Commissioner was of the view (1) that the saree pieces fell under entry 3(i) of Schedule E and not under entry 15 of Schedule A or, in the alternative, entry 4 of Schedule D, as contended by the petitioners, and (2) that the embroidered three yards pieces intended for ladies' underwear would not fall under entry 15 of Schedule A or entry 4 of Schedule D, but would fall under entry 15 of Schedule A or entry 4 of Schedule D, but would fall under entry 22 of Schedule E to the Act. According to the Deputy Commissioner, what was so