- (1.) THESE appeals by special leave are directed against the judgment of the Orissa High Court answering the question referred to it by the Sales Tax Tribunal, Orissa in the affirmative, in favour of the assessees and against the Revenue.
(2.) SERIAL No. 35 of the Schedule to the Orissa Sales Sales Tax Act, mentioned "tobacco" as defined in section 2(c) of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 as an item entitled to exemption from tax under that Act for the period from July 1, 1967. The entry continued in force up to March 31, 1968. The expression "tobacco" as defined in section 2(c) of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 has the meaning given to it in item 9 of the First Schedule to the Central Excises and Salt Act, 1944 set out in the following items : "'Tobacco' means any form of tobacco, whether cured or uncured and whether manufactured or not, and includes the leaf, stalks and stems of the tobacco plant, but does not include any part of a tobacco plant while still attached to the earth." The assessees in these appeals dealt in a product called "gudakhu". They did not include the turnover of "gudakhu" in their assessment return under the Orissa Sales Tax Act and under the Central Sales Tax Act, although they were entering into internal and inter-State sales. They took the stand that both categories of sales of "gudakhu" were exempt from tax under the two enactments, and relied on serial No. 35 of the Schedule to the Orissa Sales Tax Act. The Sales Tax Officer levied sales tax on the turnover of "gudakhu" both under the State and the Central Sales Tax Acts, but the assessments were annulled on appeal by the Assistant Commissioner of Sales Tax. The appellate order was upheld by the Tribunal and the Tribunal, at the instance of the Revenue, referred the following questions of law of the High Court : "(i) Whether, 'gudakhu' is covered by the expression, 'tobacco' as defined in section 2(c) of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 which was substituted with effect from July 1, 1967, by Notification No. 21278-F dated June 6, 1967 and is exempted from tax under the Orissa sales Tax Act, 1947 ? (ii) Whether 'gudakhu' is not taxable under the Central Sales Tax Act, 1956 during the period 1967-68 as per the provision contained in section 8(2A) of the Central Sales Tax Act, 1956 ?"
(3.) AS mentioned earlier, the High Court answered those questions in favour of the assessee and against the Revenue. Hence these appeals.;