TMI Blog1990 (6) TMI 195X X X X Extracts X X X X X X X X Extracts X X X X ..... d October 24, 1973, for twelve presses, no press was taken delivery of till the same date. As such, the terms of these two contracts were revised by what was called a package deal on April 2, 1976. According to this package deal, final billing price of each of the four presses to be taken delivery of under the first order was fixed at Rs. 9,22,181. With regard to the second purchase order for twelve presses, the order was cancelled for four presses and for the balance of eight, the final billing price was fixed at Rs. 10,96,000 per press. It was also agreed that the Central sales tax, local taxes, duties, levies, etc., would be charged extra at the prevailing rate at the time of delivery. With regard to the purchase order dated July 14, 1973, the four presses were agreed to be taken delivery of by October 29, 1976 and a contingency provision was made to the effect that in case any export order was received by the Madras Rubber Factory for any of these presses it agreed that it would pay cash for the four presses by October 29, 1976, if it could not arrange payment under I.D.B.I. scheme. It was also agreed that delivery order would be issued by the assessee on receipt of the I.D.B.I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ras, the Tribunal after considering the materials placed before it, held as follows: ".......On a consideration of the materials placed before us, we are of the view that the agreement providing for the payment of interest called commitment charges up to the time of delivery over and above the price agreed upon would amount to an escalation of the sale price agreed upon, depending on the actual time of payment and delivery of the goods. Section 2(r) of the Tamil Nadu General Sales Tax Act defines 'sale' as meaning every transfer of property in goods for cash or for deferred payment or other valuable consideration and 'turnover' as the 'aggregate amount' for which goods are bought or sold. The 'aggregate amount' will include all payments made in consideration of the sale. In this case, instead of making a further revision of the sale price to compensate for the delay in payments in view of the time-schedule fixed by the package deal, the parties agreed to the payment of commitment charges by way of interest on the outstanding up to the time of delivery. The terms of the package deal do not indicate that there was a credit sale for the amount fixed and agreed upon on the date of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as owner, usufructuary mortgagee, tenant or otherwise, shall be excluded from his turnover. " Section 2(q) of the Act defines "total turnover" which is to the following effect: "'total turnover' means the aggregate turnover in all goods of a dealer at all places of business in the State, whether or not the whole or any portion of such turnover is liable to tax." Section 2(p) of the Act defines "taxable turnover" which is to the following effect: "'taxable turnover' means the turnover on which a dealer shall be liable to pay tax as determined after making such deductions from his total turnover and in such manner as may be prescribed." Explanation (3)(a) to section 2(n) of the Act is to the following effect: "The sale or purchase of goods shall be deemed for the purposes of this Act, to have taken place in the State, wherever the contract of sale or purchase might have been made, if the goods are within the State- (i) in the case of specific or ascertained goods, at the time the contract of sale or purchase is made; and (ii) in the case of unascertained or future goods, at the time of their appropriation to the contract of sale or purchase by the seller or by the pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a separate item in the bill...... " This Court, quoted with approval the following passage in the judgment of Goddard., L.J., in Love v. Norman Wright (Builders) Ltd. [1944] 1 All ER 618, in George Oakes (Pvt.) Ltd. v. State of Madras [1961] 12 STC 476 (SC), in which it is observed as follows: ".......Where an article is taxed, whether by purchase tax, customs duty, or excise duty, the tax becomes part of the price which ordinarily the buyer will have to pay. The price of an ounce of tobacco is what it is because of the rate of tax, but on a sale there is only one consideration though made up of cost plus profit plus tax. So, if a seller offers goods for sale, it is for him to quote a price which includes the tax if he desires to pass it on to the buyer. If the buyer agrees to the price, it is not for him to consider how it is made up or whether the seller has included tax or not......So far as the purchaser is concerned, he pays for the goods what the seller demands, viz., the price even though it may include tax. That is the whole consideration for the sale and there is no reason why the whole amount paid to the seller by the purchaser should not be treated as the conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , with regard to section 2(n) of the Act, has to be rejected since that section has nothing to do with the transaction on hand and that provision is only about the "situs" of the sale. In our view, "interest" or "commitment charges" have to be included in the taxable turnover of the assessee. 6.. We do not think the decision cited by Mr. K.J. Chandran, the learned counsel appearing for the assessee, which is reported in Food Corporation of India v. State of Kerala [1988] 68 STC 1, applies to the facts of the case on hand. That case was about the administrative surcharge and price equalisation charge due to Government from retailers and the Supreme Court in that case has held that those two items were never part of the price and that the price in fact was specifically determined under a separate provision of the agreement. So also, the decision relied upon by the learned counsel for the assessee, which is reported in State of Madras v. Baliga Lighting Equipment (P.) Ltd. [1969] 23 STC 154, a Division Bench of this Court has held that the insurance charges incurred to cover the risk in transit of the goods cannot be included as part of the turnover under rule 6 of the Madras Genera ..... X X X X Extracts X X X X X X X X Extracts X X X X
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