JUDGMENT A. K. MATHUR, C.J. - This is a sales tax reference at the instance of the assessee under section 44(1) of the M.P. General Sales Tax Act, 1958 (hereinafter referred to as "the Act") and following two questions of law have been referred by the Tribunal for answer of this Court, which read as under : "1. Whether the Tribunal committed an error of law in disallowing the claim of tax-paid packing material in view of the finding of the honourable High Court of M.P. in the case of K. P. Sons v. Sales Tax Officer [1987] 67 STC 38; [1986] 19 VKN 303 and Kukreja Udyog v. Commissioner of Sales Tax [1987] 67 STC 43 [App.]; [1985] 18 VKN 475 etc. ? 2. Whether there is justification in law to subject to tax packing material amounting to Rs. 4,44,851 sold along with the tax-paid goods, especially when it was subjected to tax at the time of purchase ?" 2. The brief facts giving rise to this reference are : that the assessee, who manufactures atta, maida, rawa, etc., was assessed to tax under the Act by the assessing officer for the period January 1, 1982 to December 31, 1982 by order dated September 13, 1985. We are concerned in this reference only with a limited question, "whether the assessee is entitled to deduction of tax on the tax-paid packing material under section 2(r)(ii) of the Act ?" The assessee sought a deduction on the tax-paid packing material, which was resold containing the manufactured products and claimed an exemption from tax under section 2(r)(ii) of the Act. The Tribunal observed that this point was not raised at the original assessment stage and rejected the contention with reference to the definition of "sale price" in section 2(o) of the Act and the explanation below it. Therefore, an application was made before the Tribunal for referring the aforesaid questions, before this Court and accordingly, aforesaid two questions have been referred before this Court for answer. 3. Therefore, an application was made before the Tribunal for referring the aforesaid questions, before this Court and accordingly, aforesaid two questions have been referred before this Court for answer. 3. It was pointed out that since the packing material was tax-paid, therefore, the assessee was entitled to deduction under section 2(r)(ii) of the Act; and in that connection, a reference was made to the decisions of this Court in the cases of K. P. Sons v. Sales Tax Officer [1987] 67 STC 38 and Kukreja Udyog v. Commissioner of Sales Tax [1987] 67 STC 43 [App.]. The main contention of the learned counsel for the petitioner is that since the packing material is a tax-paid material, therefore, he is entitled to the deduction of the tax paid on the tax-paid material, when it is resold. A similar question had come up before this Court also in the case of Ganga Enterprises v. Commissioner of Sales Tax [1996] 100 STC 549 in which it was held that the assessee was entitled to the deductions and in that it was observed : ".........As a matter of fact, in the definition 'taxable turnover', certain reliefs have been given that how the total taxable turnover shall be worked out and for that, it is clearly mentioned in clause (ii) that the tax-paid goods which is being used, or becomes a part of another finished goods, which is sold in the market, then that amount of tax will be deducted in order to work out the taxable turnover." In the present case, admittedly the packing materials was tax-paid and, therefore, the assessee is entitled to deduction of the tax paid on the packing material. 4. In this view of the matter, we are of the opinion that the view taken by the Tribunal is not correct and we answer both these questions in favour of the assessee and against the Revenue and hold that the assessee is entitled to deduction of the tax paid on the packing material from the taxable turnover. Reference answered in favour of assessee.