TMI Blog1983 (12) TMI 269X X X X Extracts X X X X X X X X Extracts X X X X ..... charges at the rate of Rs. 4 per crate. This claim was rejected by the assessing authority on the ground that the said charges were incurred prior to the sales effected. The Deputy Commissioner of Commercial Taxes (Appeals), Bangalore City, also did not give any relief to the petitioner. While dismissing the appeal of the petitioner, he observed that there was no packing involved at the time of sales of liquor bottles. With regard to the claim for deduction of forwarding charges, this is what the Deputy Commissioner observed: "As per trade practice in vogue the companies are giving delivery to the bars, restaurants and wine stores of goods dealt by them. Hence there is no question of charging freight charges to the local customers. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are mostly incurred towards the various activities like unloading, unpacking, getting the bottles sealed, repacking and so on, we have to conclude that these charges go to increase the cost of liquor sold." Being aggrieved by these orders, the petitioner has approached this Court with the revision petition under section 23(1) of the Karnataka Sales Tax Act. 3.. Before we examine the contentions urged, it will be useful to refer to the nature of the activities of the petitioner so far as they are found on record. The petitioner-company is not having any manufacturing unit at Bangalore or, as a matter of fact, not even in the State of Karnataka. It manufactures liquor at PaIghat, in Kerala State. It had, during the relevant period, sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n: Price per dozen 1.. Dozen Primer Henninger Lager Rs. 31.50 157.50 2. Add: KST at 25% 39.38 3. Bottles deposit 45.00 4. Crates deposit 35.00 5. Packing and forwarding charges at Rs. 4.00 per crate 20.00 ------ 296.88 ------ Since the petitioner claims deduction of packing and forwarding charges under rule 6(4)(f) and (ff), we may now read these rules: Rule 6(4)(f): "all amounts falling under the head 'freight', when specified and charged for by the dealer separately without including such amounts in the price of the goods sold." Rule 6(4)(ff): "all amounts falling under the head 'charges for packing materials and cost of labour'." 6.. The claim of the petitioner cannot be allowed or rejected by merely referring ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... then take a case where a dealer transports goods from his factory to his place of business and sells them at a price which is arrived at after taking into account 'freight and handling charges' incurred by him in transporting the goods. The amount of 'freight and handling charges' included in the price would obviously be part of the 'sale price', because it would be payable by the purchaser to the dealer as part of the consideration for the sale of the goods. The same would be the legal position even if the 'freight and handling charges' are shown separately in the bill and added to the price of the goods, for the character of the payment would remain the same. Since 'freight and handling charges' represent expenditure incurred by the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her. 8.. We may straight away say that merely because the rate of charge recovered was uniform irrespective of the distance of transportation cannot be an indication to hold that it has no relation to the expenses incurred. To keep the price of the goods uniform at every point of sale, the petitioner might have collected the uniform rate of packing and freight charges taking into consideration of the total sale and the distance to be covered in each day. Equalised freight irrespective of the distance is not uncommon in trade practice. 9.. The real question that remains to be considered is as to the place where the sale was completed, whether at the depot or at the customer's place and whether Rs. 4 per crate was collected as incidents o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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