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TMI Blog1956 (3) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... elating to the value of 1059 bags of bran alleged to have been kept outside the books. The assessee held a licence under section 8 of the Madras General Sales Tax Act but exemption on the turnover of Rs. 85,003-9-0, representing the price of jaggery sold by the assessee as commission agent, was refused on the ground that he had not included the amounts collected by him by way of dharmam (charity), valtar (subscriptions to a local merchants' association) and katha cooly (accountancy charges) aggregating to Rs. 780-9-9 in his turnover or in the pattials issued to his principals. It is admitted on behalf of the assessee that this sum of Rs. 780-9-9 did not form part of his agreed commission. The contention is that the above sums did not also f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of the Act, to pay for each year a tax on his total turnover. Under rule 4(1) of the Turn- over and Assessment Rules the gross turnover of a dealer is the amount for which the goods are sold by the dealer. But for the exemption given by section 8 of the Act the assessee would be liable to pay tax as a dealer on the sales of jaggery effected by him. Section 8 of the Act, so far as it is here relevant, runs as follows: "8. The State Government may, on application and on payment of such fee as may be prescribed in that behalf, license any person (1) [1952] 3 S.T.C. 121; I.L.R. 1952 Mad. 571. under this section, who for an agreed commission or brokerage, buys or sells on behalf of known principals specified in his accounts in respect of eac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ges incidental to the transaction of sale and for the objects indicated by the appellation given to these payments, and not as consideration for the sale or as the price of the goods and therefore they were not included in the turnover of the principals or shown in the pattials issued to them by the assessee. The contention of the respondent is that there has been a violation of the conditions of the licence because the amounts collected by the assessee as dharmam, valtar and katha cooly must really be deemed to be part of the price of the goods and these amounts should have been included in the turnover of the seller-principals as part of the price. It might here be observed that the knowledge of the seller-principals that these amounts we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that it "shall be deemed to have effect from the commencement of the Madras General Sales Tax (Amendment) Act, 1947". According to the amended definition of "turnover" the consideration for the sale of goods includes sums charged by a dealer for anything done in respect of the goods at the time of or before their delivery and any other sums charged by the dealer, whatever be the description, name or object. Dharmam, valtar and katha cooly would clearly fall within this extended definition of "turnover". The pay- ments are made to the assessee by the buyer of jaggery as part of the transaction of sale at a fixed percentage of the value of the goods sold. But for the sale, the buyer would not have made these payments and the assessee could n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herefore not shown as such in the pattials. Reliance was placed on a recent decision of this Court in The State of Andhra v. Tungabhadra Industries Ltd.(2), where it was held that even after the recent amendment of the definition of "turnover" with retrospective effect by Andhra Act XIII of 1954 sales tax, though included as an item in the bill given by the dealer to the buyer and realised by the dealer from the buyer, is not part of the turnover of the dealer. The reasoning of the learned judges was that the total amount set out in the bill could have reference only to the consideration for the sale and that sales tax collected by a dealer on behalf of and for payment to the Government, could not be said to be part of the consideration for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount which he has (1) [1953] 4 S.T.C. 376. (2) [1955] 6 S.T.C. 379; (1955) A.L.T. 465. shown as the consideration for the sale in his turnover and pattials. For these reasons, the contentions of the assessee with regard to his liability for tax on the sum of Rs. 85,003-9-0 fail. The second objection of the assessee relates to Rs. 14,826 included in his turnover as the price of 1059 bags of bran not entered in his regular books of account but traced by the department to a secret book or memorandum kept by him. The explanation of the assessee that the bulk of the goods had been kept in his godowns for and on account of other dealers and sold by them has not been accepted by the assessing and appellate authorities. The fact that the other ..... X X X X Extracts X X X X X X X X Extracts X X X X
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