The expression 'Vanaspati Industry (Vegetable Oil)' used in the exemption provision meant an industry producing anything wherein vegetable oils constitute the chief raw material, and the sale of vegetable oil to such an industry would not be liable to sales tax.

( 1 ) THE petitioner in this case seeks a writ of certiorari for quashing an order of the Sales Tax Officer, Ujjain, dated the 6th August, 1957, assessing it to sales tax under the Madhya Bharat Sales-tax Act, 1950, in the assessment year 1954-55. It also prays that the notice of demand calling upon it to pay Rs. 1671-9-9 in respect of the assessment be quashed and the opponent be restrained from recovering that amount.

( 2 ) THE petitioner-Company carries on the business of extracting oil by mechanical process from oil seeds, such as ground-nut, Tilli etc. , and of selling the oil so extracted. During the material period the petitioner sold vegetable oil to the Indore Oil Mills Private Ltd. , the turnover of which was determined by the Sales Tax authorities at Rs. 106983/-for the purpose of assessment of a sales tax. On this turnover the amount of sales tax imposed was Rs. 1671-9-9. The Indore Oil Mills Private Limited, own a factory where they manufacture refined oil and other products. The petitioner-Company was liable to pay sales tax in respect of the sale of oil to the Indore Oil Mills Private Limited, under item No. 2 of the notification dated the 24th October, 1951 issued under Section 5 of the Act. The charging provision imposing sales tax at the rate of Rs. 1-9-0 per cent ad valorem is as follows :

"2. All types of Vegetable Oils (exclud- On sale by ing Hydrogenated Oils which in- importer or elude Cocogem), with the excep- by manution of Oils extracted from Gha-facturer. nees by human or animal labour. "

The petitioner did not dispute that under the aforesaid provision the oil sold to the Indore Company was subject to sales tax. The petitioner, however, contended before the taxing authorities that inasmuch as the oil sold to the Indore Company was for the manufacture of refined oil in their industry, namely, Vanaspati Industry (Vegetable Oil), the transactions in question were exempt from sales tax under notification No. 75/7 S. R. /55 (51) dated the 24th November, 1953, published in the Madhya Charat Government Gazette dated the 3rd December, 1953, exempting from sales tax the sale of certain goods required in the industries enumerated in the schedule read with the notification. Item No. 23 of the Schedule read with the notification exempted "steam coal and all oils" required in Vanaspati Industry (Vegetable Oil ). The contention of the assessee was negatived by the Sales Tax Officer, who took the view that under item No. 23 the sale of goods and raw materials required only in Vanaspati Industry was exempt from tax and that the oil refining industry was not Vanaspati Industry.

( 3 ) SHRI Sanghi, learned counsel for the petitioner, argued that having regard to the fact that by the notification dated the 11th September, 1950, issued under Section 4 (3) of the Act, which was cancelled by the subsequent notification No. 75/7 S. R. /55 (51) dated the 24th November, 1953, sale of oil to the manufacturer of refined oil was exempt from tax, and regard being had to the fact that whenever it was intended to connote a narrow meaning of the words Vegetable Oil' it was done by using express qualifying words, the Sales Tax Officer was not Justified in giving a narrow meaning to the words 'vegetable oil' while construing the exemption provision. It was said that the words 'vanaspati Industry' (Vegetable Oil), as used in the exemption provision, meant an industry manufacturing not only Vanaspati ghee or hydrogenated vegetable oil but also an industry manufacturing any product with vegetable oil as the chief raw material; that the refin- ed oil was a product produced after subjecting crude vegetable oil to a chemical process or refining; and that, therefore, the oil sold by the petitioner to the Indore Company was exempt from any sales tax.

( 4 ) THE only question that arises for consideration in this case is as to the true and proper construction of the expression Vanaspati Industry (Vegetable Oil)' used in item No. 23