R.N. Misra, J.
1. The Additional Member, Sales Tax Tribunal, Orissa, has stated this case and referred the following questions for the opinion of the court:
(i) Whether, on the facts and in the circumstances of the case, the Additional Tribunal was correct in holding that pure silk, matha, kantia and other similar products dealt in by the applicant are taxable being covered under entry serial No. 8 of the list of taxable goods ?
(ii) Whether, on the facts and in the circumstances of the case, the Additional Tribunal was correct in upholding the assessment without a specific finding that silk articles dealt in by the petitioner were valued more than Rs. 10 a piece ?
(iii) Whether, on the facts and in the circumstances of the case, the Additional Tribunal was correct in upholding the assessment of tax on tasar, kantia and matha dealt in by the assessee ?
2. The assessee carries on business in handloom cloth, sarees including silk, tasar and matha goods. Its principal place of business is at Puri and there is a branch at Cuttack. The Cuttack branch is separately registered and bears registration mark CUIW 740. The relevant period is 1971-72. The petitioner returned a gross turnover of Rs. 3,51,149.96, but showed taxable turnover at nil. The assessing officer held that sale of silk, tasar and matha articles were liable to tax at different rates as prescribed and raised a demand of Rs. 1,272.50. In first appeal, the assessment was affirmed. The Tribunal held in second appeal:.It is not disputed that the appellant dealt with goods which are manufactured out of tasar, matha and kantia. It is further not disputed that the appellant made purchases of these articles from local weavers and these local weavers utilised handspun yarn and woven them by handloom. It is true that the appellant contended that in the absence of any material that he has purchased 5 per cent of his total purchases relating to pure silk cloth, this estimate is erroneous. But this was not very much seriously pressed. Hence the estimation made regarding the quantity of the goods dealt need be accepted.
The next dispute is regarding the taxability of the silk cloth. The learned counsel made twofold arguments. He stated that under entry No. 19 handloom or powerloom woven cloth of all kinds are tax-free. In that view these goods dealt in by the appellant came under the purview of entry No. 19. I may say that a close reading of entry No.' 19 shows that this entry excepts the cloth made from pure silk of handloom origin. In that view, the appellant's goods cannot be treated to come under entry No. 19 to earn the tax-free quality. The next entry is entry No. 24 of the tax-free list. It was very vehemently urged on behalf of the appellant that 'khadi' has been denned under the Khadi and Village Industries Act to be handspun and handwoven. It has further been defined that handspun and handwoven woollen and silken materials are also khadi. In view of these definitions of the Khadi Act, the goods dealt in by the appellant being both handspun and handwoven, the forums below should have treated these materials to come under the purview of entry No. 24 of the tax-free list. I may say that it is true that the definition of the Khadi Act supports the contention of the appellant. But the said reasoning cannot apply while considering the taxability of the articles dealt in by the appellant. Entry No. 8 of the taxable list of goods other than luxury goods reads as follows:
All silk goods including all mill-made or powerloom woven pure silk fabrics and pure silk cloth of handloom origin.Under this entry these are to be taxable at 7 per cent till 31st December, 1971, and at 8 per cent from 1st January, 1972. Thus this entry is specific for imposing tax on all silk goods and specifically pure silk cloth of handloom origin. In view of this specific entry, I am of opinion that the appellant's contention that the goods dealt in by him are khadi and are tax-free has been rightly rejected....
3. Legal position is settled beyond doubt that the various entries have to be harmoniously construed so as to avoid confusion and overlapping. Similarly, it is beyond dispute also that exemptions are to be strictly construed and unless exemption has been specifically provided, the same should not be extended. If the intention to tax is clear and specific, an exemption provision cannot be so interpreted as to annul the tax liability.
At the relevant time for the assessment in question, the appropriate notifications for taxable and tax-free goods made under Section 5 of the Act were thus :
Taxable goods Tax-free goodsSI. No. 8. All silk goods including all 19. Handloom or powerloom woven mill-made or powerloom cloth of all kinds excepting clothwoven pure silk fabrics and made from pure silk of handloompure silk cloth of handloom origin.origin.SI. No. 9. Silk yarn excluding hand- 24. Khadi handloom woven yarn andspun silk yarn. khadi handloom woven cloth andkhadi ready-made garments.
Serial No. 8 in clear terms makes provision for all silk goods. To avoid ambiguity, it specifically brings into its fold what is excepted in serial No. 19. There is force in the submission of the learned standing counsel that it had never been intended that silk goods of whatever origin was to be exempted from tax. If that were so, keeping the manner in which provision was made in serial No. 9 above in view, the learned standing counsel contends that in serial No. 24 an inclusive provision could have been indicated to cover handwoven silk. Silk yarn is made liable to tax, but handspun silk yarn has been exempted.
The assessee's counsel has strenuously contended that 'khadi' has a statutory definition under the Khaddar (Protection of Name) Act, 1950, where it has been said:
The words khaddar and khadi, whether in Hindi or in any other Indian language or in English, when applied to any woven material, shall be deemed to be a trade description within the meaning of the Indian Merchandise Marks Act, 1889, indicating that such material is cloth woven on handlooms in India from cotton, silk or woollen yarn handspun in India or from a mixture of any two or all of such yarns.
'Khadi' has also a definition under the Khadi and Other Handloom Industries Development (Additional Excise Duty on Cloth) Act, 1953, where it has been defined to mean :.any handloom cloth woven from yarn handspun in India.
'Khadi' has also been given a definition under the Khadi and Village Industries Commission Act, 1956, where it has been defined to mean :.any cloth woven on handlooms in India from cotton, silk or woollen yarn handspun in India or from a mixture of any two or all of such yarns.
It is contended that by the time the notification came in 1957, the statutory definitions were in vogue and khadi appearing in serial No. 24 was intended to cover the same meaning as defined. 'Khadi', apart from the statutory definitions, is a term of common parlance associated with the national struggle for independence of the country. Under Gandhiji's leadership khadi became popular as a substitute for Manchester textiles and really referred to charkha spun material.
Reliance is placed on the existing entry No. 19, which provides :
hadi cloth of all kinds including pure silk cloth, khadi woollen goods and handspun yarn sold by dealers duly certified by the Khadi and Village Industries Commission or Akhil Bharatiya Charkha Sangh.
The language of the present entry makes it obviously clear that the intention was that all kinds of khadi cloth were to be exempted from tax and khadi had been used to connote the manufacturing process, i.e., handspun yarn and handwoven cloth. We have been asked to take note of the fact that entry No. 19 was suitably amended as the authorities under the statute did not give effect to the intention of the State Government. We are inclined to agree that khadi had been used in serial No. 24 to convey the manufacturing process and covered not only cotton cloth but also silk and woollen fabrics. The emphasis was on the manner of manufacturing. It would follow, therefore, that within the ambit of the exemption clause would come handspun silk yarn and handspun cloth out of such yarn. Serial No. 9, as we have already pointed out, exempts handspun silk yarn from taxation. Serial No. 24 fits in with the position that handspun (sic) cloth from such yarn would also be exempt. The language of serial No. 19 also throws some light on the question. While exempting handloom and powerloom woven cloth of all kinds from taxation, it excludes cloth made from pure silk of handloom origin. The exception in serial No. 19 does not relate to handspun silk yarn and handwoven cloth from such yarn. Since a harmonious construction has to be put on these entries, we think, the assessee's stand should be accepted and handspun yarn and haridwoven cloth from such yarn were intended to be tax-free and no sales tax is exigible on the same during the period.
The learned standing counsel relied on a Bench decision of this Court in support of his proposition that khadi silk would fall under serial No. 8. Both of us sitting in a Bench in the case of Orissa Co-operative Handicrafts Corporation Ltd. v. State of Orissa  38 S.T.C. 131, had taken the view that khadi silk fell under serial No. 8. At that point of time no reference to the statutory definition of 'khadi' had been placed before us and merely by looking into the two entries, we had come to hold that khadi silk fell under serial No. 8. At one point of time we were thinking that the matter should be referred to a larger Bench and we should not take upon us the responsibility of distinguishing our earlier decision. But we are impressed with the argument that the statutory definitions in the three Central Acts preceding the notification in question had not been placed before us on the earlier occasion and there has been no analysis of the respective entries to find out the ambit of inclusion and the purview of exclusion. In the circumstances, we do not think there is any necessity of referring the matter to a larger Bench. The decision in the Orissa Co-operative Handicrafts Corporation case  38 S.T.C. 131 must be confined to its own facts and in the present case for the reasons we have already indicated, we would hold that khadi silk was covered by serial No. 24 at the relevant time and was thus a tax-free commodity.
4. So far as tasar is concerned, even on the earlier occasion in Orissa Co-operative Handicrafts Corporation Ltd. v. State of Orissa  38 S.T.C. 131, we had taken the view that tasar articles were not liable to tax as they did not come within the ambit of serial No. 8. Matha also would go in the same way as tasar and cannot be taken to be included in serial No. 8. We would accordingly hold that sale of matha and tasar goods was not exigible to sales tax.
5. Our answers to the questions referred, therefore, are :
(i) On the facts and in the circumstances of the case, the Additional Tribunal was not correct in holding that silk, matha and kantia manufactured by handwoven process from handspun yarn were covered by serial No. 8 of the list of taxable goods.
(ii) We need not answer the second question as it would no more arise.
(iii) On the facts and in the circumstances of the case, the Additional Tribunal was not correct in upholding the assessment of tax on tasar, kantia and matha articles. These would be covered by the entry relating to exemption and not by serial No. 8.
There will be no order for costs.
K.B. Panda, J.