RAVEENDRAN, J. ( 1 ) PETITIONER is a registered dealer under the Karnataka Sales Tax 1957 (Act for short) carrying on business inter alia, in buying and selling damaged food grains (wheat and rice) nom Food Corporation of India. ( 2 ) FOOD Corporation of India (FCI for short) first respondent herein periodically issues tender notices for disposal of damaged food grains specifying the purpose for which such imaged food grains can be used The four specified purposes are: (1) fit for cattle/poultry feed; (2) fit for industrial use as manure as for use as manure; (3) fit for use as manure only; and (4) fit for manufacture of inedible starch only. Clause (L) (i) of the General terms and conditions of sale of damaged food grains provides thus: it is absolutely necessary that the buyer of any particular category of stock shall use the same only for the purpose indicated and shall make no attempt whatsoever for adulteration or misuse of the stocks. The Food Corporation of India will take a serious view of any breach of these conditions of sale. It will also not be open to the buyers to question the categorization of the stock as shown in the tender. ( 3 ) PETITIONER made several purchases in pursuance of tender Notices issued by FCI for disposal of damaged rice and wheat fit for cattle and poultry feed between the assessment years 1993-94 to 1998-99. Petitioner contended that even damaged rice and wheat continued to be wheat and rice and therefore they were exempted from payment of tax under Schedule V to the Act. It would appeal that FCI was however collecting sales tax at 2% under Part A-Entry 6 of Schedule-II treating the damaged rice/wheat as animal feeds. The petitioner claims to have paid such sales tax at 2% under protest, obtain release of the goods. ( 4 ) WHEN matters stood thus, the Commissioner of Commercial Taxes, Karnataka issued a clarification dated 18-8-1994 to FCI stating that damaged Rice and Wheat, which are unfit for human consumption is taxable at 8% on the first sale point under Section 5 (1) of the Act (as goods not falling under any of the schedules ). ( 4 ) WHEN matters stood thus, the Commissioner of Commercial Taxes, Karnataka issued a clarification dated 18-8-1994 to FCI stating that damaged Rice and Wheat, which are unfit for human consumption is taxable at 8% on the first sale point under Section 5 (1) of the Act (as goods not falling under any of the schedules ). Having regard to the said clarification issued by the Commissioner of Commercial Tax on 18-8-1994, FCI, by its letter dated 4-9-1995 demanded the difference in tax at 6% in regard to sales under three invoices release orders dated 9-11-1994. Feeling aggrieved, petitioner filed W. P. No. 33686/1995 for quashing the demand letter dated 4-9-1995. Subsequently, petitioner filed W. P. No. 7971/1998 for a declaration that damaged wheat/rice purchased by him from FCI was taxable only at 2,10 under Part A Entry 6 of Schedule-II and not at the higher rate under Section 5 (1) of the Act. Both these Writ petitions were disposed of by a learned Single Judge, by the following common order dated 25-5-1998 without assigning any reasons: heard the learned Counsel. The Circular issued by the Commissioner date 18-8-1994 (Annexure-C) shall not be acted upon. Petitions stand disposed of with the above observations. It is stated that in respect of sales effected subsequent to the receipt of Commissioners classification dated 18-8-1994, FCI was collected Sales Tax under Section 5 (1) of the Act (initially at 8%, taken at 12% and at 10% from 1-4-1998 ). ( 5 ) THE petitioner by letter dated 18-1-1999 requested the FCI to reimburse Rs. 33,263/- being the sales tax and surcharge paid by him on purchase of damaged Rice/wheat between 14-7-1993 and 10-8-1998, on the ground that no sales tax was payable on such purchases. As the amount was not refunded, the petitioner has filed this petition. Subsequent to the filing of this petition petitioner received a communication dated 30-5-2000 demanding sales tax at 10% + cess at 5% in regard to sales of damaged rice effected from 28-10-1998. Petitioner amended the petition by adding a relief in respect of the communication dated 30-5-2000. As the amount was not refunded, the petitioner has filed this petition. Subsequent to the filing of this petition petitioner received a communication dated 30-5-2000 demanding sales tax at 10% + cess at 5% in regard to sales of damaged rice effected from 28-10-1998. Petitioner amended the petition by adding a relief in respect of the communication dated 30-5-2000. The prayers in the writ petition are: (a) A declaration that damaged wheat and rice purchased from the respondents is nothing but wheat and rice, falling under entries 64 and 40-A of the V Schedule to the Act prior to 1-41998 and entry 15 (wrongly typed as entry 17) of the V schedule to the Act, after 1-4-1998; (b) A direction to first respondent (FCI) to expedite the refund of sales tax; and (c) For quashing the letter dated 30-5-2000 demanding sales tax at 10% + cess at 5% in regard to sales of damaged rice with effect from 28-10-1998. ( 6 ) FIRST respondent (FCI) contends that it had collected Sates Tax as per the clarification issued by the Commissioner of Commercial Taxes that sale of damaged wheat and rice are taxable under Section 5 (1) as general goods not classified under any of the schedules and that the sales tax collected nom the petitioner has already been remitted to the Commercial Tax Department. First Respondent also submitted that assessments have been concluded by assessing the turnover relating to sales of damaged wheat/rice made to petitioner, to tax under Section 5 (1) of the Act. It therefore contends that it is not liable to refund any tax amount to petitioner. ( 7 ) THE State has contended that only rice and wheat meant for human consumption are exempt from tax under Schedule-V and damaged wheat/rice which are unfit for human consumption cannot be considered as wheat/rice or cereals. It is submitted that wheat and rice which is damaged loses its original character and identity as rice or wheat meant for human consumption and therefore ceases to be wheat and rice or cereal as understood in common parlance. It is contended that damaged rice/wheat unfit for human consumption, though fit to be used as cattle feed; if not processed, will not fall under Part A Entry 6 of Second Schedule. It is stated such goods are taxable under Section 5 (1) of the Act. It is contended that damaged rice/wheat unfit for human consumption, though fit to be used as cattle feed; if not processed, will not fall under Part A Entry 6 of Second Schedule. It is stated such goods are taxable under Section 5 (1) of the Act. ( 8 ) ON the contentions raise~ the following questions arise for consideration: (i) Whether damaged wheat and rice fall under Entry- 15 of Fifth Schedule (Entry 64 and 40a of Fifth Schedule prior to 1-41998) or under Section 3 (1) of the Act? (ii) Whether demand for payment of tax under Section 5 (1) of the Act as per FCIs letter dated 30-5. 2000 is valid? (iii) Whether the first respondent is liable to refund the sales tax paid on the purchase of damaged wheat and rice? point No. (i):- ( 9 ) THE points for consideration is whether (a) damaged wheat to be used as cattle/poultry feed, is wheat; (b) damaged rice to be used as cattle/poultry feed, is rice (c) damaged rice/wheat to be used as cattle/poultry feed is cereals; and (d) whether damaged wheat/rice would fall under entry 15 of Fifth Schedule or under Section 15 of the Act. ( 10 ) THE relevant entries in V Schedule from time to time are extracted below: old Entry 40a (1. 4. 1992 to 31-3. 1995) Ragi, Jowar or milo, maize, bajra, navane, same, kadan, Kutaki, rice and paddy. Old Entry 40a 1-4-1995 to 31-3-1998 Cereals (with or without husk) excluding barley. Old En 64 From 19-10-1991 to 31-3-1998: Wheat and as maida and soji of wheat. New Entry from 1-4-1998 Cereals (with or without husk) excluding barley. Rice and wheat were taxable up to 18-10-1991 under entry 9 (i) of Schedule. IV. Rice was taxable between 19-10-1991 to 31-3-1992 under entry 9 (i) of Schedule-IV. From 1-4-1992, Rice was deleted from Schedule. IV. From 1-4-1992 to 31-3-1995, Rice was exempted from tax under Entry 40a of V Schedule. From 1-4-1995 it is exempted from tax under Entry 40a under cereals. Wheat was exempted from tax from 19-10-1991 under Entry 64 of V Schedule. From 19-10-1998 both rice and wheat are exempted from tax wider Entry 15 of Schedule Vas cereals. IV. From 1-4-1992 to 31-3-1995, Rice was exempted from tax under Entry 40a of V Schedule. From 1-4-1995 it is exempted from tax under Entry 40a under cereals. Wheat was exempted from tax from 19-10-1991 under Entry 64 of V Schedule. From 19-10-1998 both rice and wheat are exempted from tax wider Entry 15 of Schedule Vas cereals. ( 11 ) WE may also refer to entry 6 of Part- A of Second Schedule which reads thus: animal feed and feed supplements, i. e. , processed commodity sold 88 Poultry Feed, Cattle Feed Pig Feed Fish Feed Fish Meal, Prawn Peed, Shrimp Feed and feed supplements and mineral mixture concentrates, intended for use as feed supplements. What is sold by FCI is not a processed commodity. To fall under entry 6 of Part A of Second Schedule, an animal feed should be a processed commodity. As damaged wheat/rice sold by FCI is not a processed commodity, the said goods will not fall under entry 6 of Part A of the Second Schedule. even though such damaged wheat/rice is intended to be used as cattle/poultry feed. ( 12 ) THE term Cereals is not defined under the Act. Section 14 of the Central Sales Tax Act, 1956 defines cereals as paddy, rice, wheat, jowar or milo, bajra, maize, ragi, kodan, kutki and barley. The fact that rice and wheat fall under cereals is not fit disputed by either side. ( 13 ) A learned Single Judge of this Court in YARANA FEEDS and FARMS vs. ASST. COMMISSIONER OF COMMERCIAL TAXES (ASSESS-MENTS), HUBLI (77 (1990) STC 144), considered the question as to whether dry fish which was non-edible, that is not fit for human consumption but which was fit for being used as poultry feed was fish; which was exempted nom sales under Entry 6a of V Schedule or whether it was subject to tax under Section 5 (1) of the Act. The learned Single Judge held that plain meaning of the word fish in entry 6a does not admit of any distinction between fresh fish and dry fish or between edible fish and non-edible fish. He further held that to exclude non-edible fish from the purview of Entry 6a would amount to legislating and amending the statutory entry, which is the privilege of the legislature. He further held that to exclude non-edible fish from the purview of Entry 6a would amount to legislating and amending the statutory entry, which is the privilege of the legislature. He therefore quashed the proposal to levy tax under Section 5 (1) of the Act on the turnover relating to non-edible dry fish. The learned Single Judge held: reverting back to the entry 6-A of the Fifth Schedule, the entry is to be understood and interpreted as found in the entry which speaks of fish in general. If it was the intention of the legislature to carve out any exception for the purpose of levy of tax on any particular kind of fish whether dry or flesh, edible or non-edible, it was for the legislature to make such distinction and to provide for levy of tax subject to the exceptions or provisions. Having regard to the plain meaning of fish in entry 6-A, which has got to be interpreted as it stands and the meaning which it conveys, it does not admit of any further distinction being made for the purpose of treating dry fish or non edible fish as taxable goods. That an entry in the schedule to the taxation act should be interpreted having regard to the plain language used by the legislature, is the settled principle of interpretations. Giving any other meaning or to exclude non edible fish from the purview of the entry would amount to legislating and amending the statutory entry, which is the exclusive privilege of the legislature. ( 14 ) IN THE STATE OF TAMIL NADU vs SRI VENKATESWARA and Co [41 (1978) S1c. 28], a Division Bench of the Madras High Court held that inedible starch made from contaminated rice is as much a rice product as rice flour or rice The Madras High Court held: the contention of the learned Additional Government Pleader is that a reading of the entire proviso would show that a concessional rate of tax of one per cent is intended to be levied only in respect of edibles and not in respect of inedibles. He submitted also that this inedible starch made out of contaminated ice is not a rice product so as to come within the scope of this proviso. We are unable to agree. He submitted also that this inedible starch made out of contaminated ice is not a rice product so as to come within the scope of this proviso. We are unable to agree. We do not find any warrant in the proviso for restricting the scope of the expression rice product only to edibles. If that proviso had stated that it would apply only to edible, then the contention of the learned Government Pleader would be correct. However, in the absence of any such restriction in the proviso we consider that the proviso cannot be construed as if it related only to edible items. It is common knowledge that even edible items are sometimes used for non-food purposes. Therefore, the way in which the particular product is used is not the criterion but it is the quality of the product that determines its liability to come within the proviso. The quality of the present product is such that it falls within rice product, ( 15 ) THE COMMISSIONER. OF SALES TAX, UP Vs PRAG ICE and OIL MILLS [35 (1975) STC 520]) a division Bench of the Allahabad High Court considered the question whether non-edible ground nut oil which contained large quantity of impurities would be ground nut oil liable to be taxed at the concessional rate of percent. It was held: it appears that the residual oil becomes unfit for human consumption due to oxidative charge because of which the rancidity increases to a considerable extent. The fact that nothing is done to arrest this process will not change the character of the commodity. If it was groundnut oil to start with it none the less remained groundnut oil even though because of the increased rancidity it may become unfit for human consumption. Groundnut oil is generally used both for human consumption as well as for manufacture of soaps. If because of the oxidation process, it ceases to be available to one of its general use but is none the less still usable for manufacture of soaps, the mere circumstances that it has become non-edible will not change its nature or character as a commercial commodity. It does not, in our opinion become an oil other than groundnut Oil. ( 16 ) IN TUNGABHADRA INDUSTRIES LTD vs. COMMERCIAL TAX OFFICER [1960 (11) STC 827]. the Supreme Court considered whether hydrogenated groundnut oil was groundnut oil? It does not, in our opinion become an oil other than groundnut Oil. ( 16 ) IN TUNGABHADRA INDUSTRIES LTD vs. COMMERCIAL TAX OFFICER [1960 (11) STC 827]. the Supreme Court considered whether hydrogenated groundnut oil was groundnut oil? The Supreme Court observed: it is this oxidative change and particularly the conversion into aldehydes that is believed to be responsible for the sharp unpleasant odour? and the characteristic taste of rancid oil. If nothing were done to retard the process the rancidity may increase to such an extent as to render it unfit for human consumption. The change here is both additive and inter molecular, but yet it could hardly be said that rancid groundnut oil is not groundnut oil. It would undoubtedly be very bad groundnut oil but still it would be un oil and if it does not seem to accord with logic that when the quality of the oil is improved in that its resistance to the natural processes of deterioration through oxidation is increased it should be held not to be oil. (Emphasis supplied) ( 17 ) THE above decisions make it clear edibility or suitability for human consumption is not necessarily a relevant criterion. A cereal or fish or vegetable oil continues be a cereal or fish or vegetable Oil even if it had become bad and inedible on account of chemical action or reaction or pest/insect attack. As rightly Observed in several decisions, if the exemption or concessional rate of tax was intended only to cereals or fish or oil which is fit for human consumption, the relevant entry would have said so. Where the description is merely rice/wheat it will refer to inedible rice/wheat also and where the description is merely vegetable oil it will include vegetable oil which has gone bad or rancid and therefore un-edible. ( 18 ) ON behalf of the Revenue, it was contend that a Division Bench of this Court has taken a somewhat different view in S. V. HALAVAPALLI and SONS vs. COMMISIONER OF COMMERCIAL TAXES (57 (1984) STC 343]. In that case, the Division Bench considered the question whether the term cereals would include seeds? It was contended that seeds of paddy, ragi, jowar, maize etc. , were cereals. In that case, the Division Bench considered the question whether the term cereals would include seeds? It was contended that seeds of paddy, ragi, jowar, maize etc. , were cereals. After referring to Section 14 of the Central Sales Act and the definition in several dictionaries, the Division Bench came to the conclusion that the dictionary meaning of cereal was a grain of a grass family yielding starchy seeds suitable for and used as food for man, and livestock. The Court distinguished between food grains that are grown for being used as human food, and sowing seeds which are not intended to be consumed. The Division Bench held that seeds were not intended for consumption and in fact unfit for consumption having been treated with chemicals and therefore poisonous. The Division Bench therefore concluded that cereals were food grains which were meant for consumption and seeds were grains which were not edible which was meant for sowing; and consequently seeds mead for sowing are not to be considered as cereals. Relying on the said decision, the learned Government advocate contended that edibility, that is being fit for consumption was the test to find out whether a food grain is a cereal and what is inedible ceases to be a cereal. ( 19 ) WE may with some advantage refer to the several dictionary meanings of the team cereal referred to in Halavapallis case and other dictionaries. 19. 1) Shorter Oxford English Dictionary defines cereal as pertaining to ceres. . . or pertaining to corn or edible grain; any grasses which are cultivated for their seed as human food; commonly comprised under the name of com or grain. 19. 2) Websters Third New International Dictionary defines cereals as relating to grain or to the plants that produce it; made of grain a plant (as a grass) yielding farinaceous seeds suitable for food (as wheat, maize, rice); also the seeds or grains so produced either in their original state or commercially prepared. 19. 3) Chambers Twenty first Century Dictionary defines cereal as (1) a member of the grass family that is cultivated as a food crop for its nutritious edible seeds i. e. , grains, eg. , barley, wheat, rice etc. ,; (2) the grain produced; from Latin Cereals relating to Ceres, goddess of agriculture. 19. 19. 3) Chambers Twenty first Century Dictionary defines cereal as (1) a member of the grass family that is cultivated as a food crop for its nutritious edible seeds i. e. , grains, eg. , barley, wheat, rice etc. ,; (2) the grain produced; from Latin Cereals relating to Ceres, goddess of agriculture. 19. 4) Mysore University English-Kannada Dictionary gave the meaning of cereal as Dhanyadha ahardha Kalugalumanushyara aharakkagi upyogisuva dhanya. . . (that is Edible Grains; Grains used for human consumption ). 19. 5) Encyclopaedia Britannica (Vol. 5 paged 203) explains cereals thus: cereals, or grains, are members of the grass family that are cultivated primarily for their starchy seeds (technically dry fruits), which are used for human food, feed for livestock, and as a source of industrial starch. Wheat, rice, maize (caned com in the U. S. and Canada), rye, oats, barley, sorghum and some of the millets are the common cereals. Wheat, rice and rye are grown primarily for consumption as human food, while much of the maize, barley, oats and sorghum grown in North America, Europe and Australia is fed to livestock to produce meat, dairy and poultry products. 19. 6) The New Encyclopaedia Britannica (15th Edition Vol. 3 page 37) gives the following information: cereal also called grain, any grass yielding starchy seeds suitable for food. The cereals most commonly cultivated are wheat, rice, rye, oats, barley, corn (maize) and sorghum As human food, cereals are usually marketed in their raw grain form or as ingredients of various food products; as animal feed, they are consumed mainly by livestock and poultry, which are eventually rendered as meat, dairy and poultry products for human consumption; and they are used industrially in the production of a wide range of substances, such as glucose, adhesives, oils and alcohols. ( 20 ) THE decision in HALAVAPALLI does not advance the case of the state that the terms cereal refers only to grains meant for human consumption. Cereal in common parlance means a grain of the grass family like wheat, rice, jowar, oats, maize etc. , used as food for man and livestock. To put it differently, any grain which is edible is cereal. Edible refers to suitability for consumption by humans. Edible also refers to suitability for consumption by livestock (domestic animals) and poultry. Cereal in common parlance means a grain of the grass family like wheat, rice, jowar, oats, maize etc. , used as food for man and livestock. To put it differently, any grain which is edible is cereal. Edible refers to suitability for consumption by humans. Edible also refers to suitability for consumption by livestock (domestic animals) and poultry. When a food grain is fit for consumption by both human and livestock, there can be no doubt that it is a cereal. Even where on account of decay or damage, a cereal is found to be unfit for human consumption but still fit for consumption by livestock, it will still continue to be a cereal. If the cereal, on account of its damaged condition is wholly unfit for consumption either by human or by livestock, but is fit to be used only as a manure or at best for production of industrial starch, then it may cease to be considered as a cereal. ( 21 ) THE contention of the State that only food grains meant for human consumption can be called as cereals cannot be accepted. If such a contention is to be accepted, the same food grain,. When earmarked for consumption by human beings will be a cereal and when earmarked for consumption by livestock, will not a cereal. For example, Sorghum and Oats are recognized as cereal, all over the world Normally they are meant for feeding livestock. , but also used for human consumption. Maize (corn) is used equally for human consumption and as animal feed. Maize, oats and sorghum of good quality which are fit to be consumed by human, are given to livestock (as contrasted nom wheat and rice which when in good condition are not normally find to livestock ). Good quality cereals like maize is used in manufacturing processed animal feed. Can it be said that good quality maize, oats and sorgham (which are fit for human consumption) cease to cereals when they are used as animal feed or poultry feed. The answer is an emphatic No. We have referred to these aspects only to point out that any food grain that can be used for consumption by humans or livestock continues to retain the characteristic of a cereal and is considered as a cereal. The answer is an emphatic No. We have referred to these aspects only to point out that any food grain that can be used for consumption by humans or livestock continues to retain the characteristic of a cereal and is considered as a cereal. We therefore hold that rice and wheat which are not fit for human consumption but fit for being used as animal feed for livestock and poultry, will still be a cereal, subject to any definition to the contrary. Accordingly, we hold that damaged rice and wheat that has been classified and certified by FCI as fit for cattle/poultry feed, will fall under cereal and be exempt from tax under Entry 15 of V Schedule. But if FCI categorizes the damaged grains as fit only for manure or fit only for manufacture of inedible Industrial starch, then it will not be a cereal falling under Entry 15 of V Schedule. ( 22 ) IN the view we have taken, the decision of the Supreme Court relied on by the State in INDIAN EXPRESS PRIVATE LTD. Vs. STATE OF TAMIL NADU (67 (1987) STC 474) holding that old newspapers sold as waste paper are not newspaper, and the decisions of this Court in PRABHAT ROLLING METAL WORKS Vs COMMISSIONER OF COMMERCIAL TAXES (69 (1988) STC 359) holding that old aluminium vessels sold as scrap are not aluminium vessels and in NOVELTY DRESS MANUFACTURING COMPANY vs. KARNATAKA APPELLATE TRIBUNAL (109 (1998) STC 14) holding that cotton rags sold as waste are not cotton fabrics, are of no assistance in this case. Re: Point No. (ii):- ( 23 ) FCI, by its letter dated 30-5-2000 called upon the petitioner to pay Sales Tax at 10% plus 5% of tax as cess in regard to sale of damaged rice already effected. In view of our decision on point (i), it has to be held that FCI is not entitled to claim any tax on damaged Rice/wheat sold for use as cattle/poultry feed. Re point (iii):- ( 24 ) THE next question is as to whether first respondent should be directed to refund the amount collected as tax. First respondent acted in a bonafide manner in collecting the tax in pursuance of the clarification dated 18-8-1994 issued by the Commissioner. The tax, refund of which is claimed, relates to the period 1993-1994 to 1998 99. First respondent acted in a bonafide manner in collecting the tax in pursuance of the clarification dated 18-8-1994 issued by the Commissioner. The tax, refund of which is claimed, relates to the period 1993-1994 to 1998 99. First respondent has been assessed to tax in regard to those years and amount recovered by it as tax in regard to the sales in favour of the petitioner have been remitted to the State Government. Therefore, we do not consider it a fit case for directing the first respondent to refund the amount collected as tax. It is open to the petitioner to seek a refund from the State Government under Section 18-AA (4) of the Act. As and when such application is made, the State Government will have to consider and dispose of the same in accordance with law and the observations made above. ( 25 ) ACCORDINGLY, we allow this writ petition in part as follows: (i) Damaged wheat and rice sold by FCI as fit for cattle/poultry feed will fall under entry is of Fifth Schedule (from 1-4-1998 and earlier under entry 64 and 40a of Fifth Schedule) and therefore exempted from tax. (ii) The Demand dated 30-5-2000 made by first respondent for payment of Sales Tax and Cess (Annexure-L) is quashed. (iii) Liberty is reserved to petitioner to seek and obtain refund of tax from the State Government in accordance with law. (iv) Parties to bear their respective costs. --- *** --- .