The Supreme Court has held that the supply of bamboo and hardwood from a Government forest under an agreement is not exigible to tax. The ruling was given by a division bench comprising Mr. Justice S.P. Bharucha and Mr. Justice K. Venkataswami while allowing an appeal in the case of Bhdrachalam Paperboards Ltd. & another Vs. the Government of Andhra Pradesh and others.The appellants had moved the Andhra Pradesh High Court for the issuance of a writ of memorandum to declare the action of the respondents in demanding and collecting sales tax from them on the royalty and extraction charges paid for the supply of bamboo and hardwood from the forest for the period 1978-79 onwards as illegal, null and void and for a consequential relief of refund of the taxes so collected from them.The appellants entered into an agreement on March 27,1978 with the State Government for supply of bamboo and hardwood from the Government forest on certain terms and conditions.