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TMI Blog1996 (8) TMI 483X X X X Extracts X X X X X X X X Extracts X X X X ..... Sl. No. No. of revision petition Under Act Assessment year 1 52 of 1996 RST 1954 1981-82 2 53 of 1996 CST 1956 1981-82 3 54 of 1996 RST 1954 1982-83 4 55 of 1996 CST 1956 1982-83 5 56 of 1996 RST 1954 1983-84 6 57 of 1996 RST 1954 1984-85 7 58 of 1996 CST 1956 1984-85 8 59 of 1996 RST 1954 1985-86 9 60 of 1996 CST 1956 1985-86 3. For the sake of convenience the facts of the revision petition No. 55 of 1996 are detailed here. The petitioner-company is a public limited company and is engaged in the manufacture and sale of toughened glass. Since the produce of the petitioner-company is an excisable item excise duty was charged at 8 per cent. The excise duty so charged was a part of the sale price of the product. There arose a dispute with regard to the rate at which the excise duty was to be leviable/payable. The company started charging excise duty from its customers at 35 per cent, but for the purposes of the payment of sales tax it was including in its taxable turnover the excise duty at 8 per cent only. This differential amount of 27 per cent was provisionally received by the petitioner-company from its customers and was ledgered in its bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such the amounts received are to be included in the taxable turnover of the petitioner-company. Before we answer this question it is apposite here to reproduce section 2(p) and (t) of the RST Act and section 2(h) of the CST Act which are as hereunder: The RST Act: "2(p) 'sale price' means the amount payable to a dealer as consideration for the sale less any sum allowed as cash discount according to the practice normally prevailing in the trade, but inclusive of any sum charged for anything done by the dealer in respect of the goods at the time of or before the delivery thereof other than the cost of freight or delivery or the cost of installation in case where such cost is separately charged, and the expression 'purchase price' shall be construed accordingly: Provided that in the case of a hire purchase agreement, the market price of the goods on the date on which such goods were transferred under such agreement shall be deemed to be the sale price of the goods; (t) 'turnover' means the aggregate amount of sale prices received or receivable for a sale, transfer, delivery or supply by a dealer in any of the ways referred to in clause (o): Provided that the proceeds of the sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the clear understanding and specific condition that it would be refunded to them in case of the Central excise duty being charged at 8 per cent and which was placed in the books of account under a separate account, namely, contingency charges account, could not be termed as a part of consideration for the sale and as such could not be included in the taxable turnover of the petitioner-company. This deposit represents an amount which was taken because of a probable contingency which could happen in the future. It was taken on the condition that it would be refunded to the purchasers/customers from whom it was taken. It could not be refunded because of lock-out in the petitioner-company's factory for the period from August 23, 1986 to January 14, 1990. The mere fact that this deposit remained with the petitioner-company could not be converted into a part of the sale price. As against this, the learned counsel for the respondent contends before us that this amount of deposit has remained with the petitioner-company. It has not so far been refunded to the purchasers from whom it was taken. The fact is that it has gone into the pocket of petitioner-company. He further contends that it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act and the sustainability of the rival contentions urged before us on this matter. Nor do we consider it necessary or proper to deal with the soundness or otherwise of the constitutional objections which have been put forward to the demand by the State, to amounts 'collected by way of tax' if that were to include collections in respect of sale transactions not charged to tax under the Act. We consider it desirable to reserve the determination of these questions to an occasion when they properly arise and have necessarily to be decided." 9.. This decision is to be distinguished on facts from the case in hand. In that decision amounts were collected on the sale transactions which were not exigible to tax. In the present case before us there is no dispute about the exigibility of the sale transactions, but what is in dispute is whether the amounts taken as deposit on account of Central excise duty, were to be considered a part of a sale price. 10.. This decision of the apex Court came in for consideration before the Madras High Court in Dalmia Cement (Bharat) Limited v. Deputy Commercial Tax Officer, Lalgudi [1989] 73 STC 167, wherein manufacturers of cement were permitted to inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harges which did not form a part of sale price. The fact that there is some excess collection in the hands of the assessee will not make it part of the sale price. Thus the lot cooly charges were not included in the taxable turnover because they were considered as service charges. In the case before us the amounts collected by the petitioner-company could not be termed as service charges. 17.. The decision in State of Maharashtra v. Britannia Biscuits Company Limited [1995] 96 STC 642 (SC), the learned counsel for the petitioner-company has placed his reliance upon, is also of no help to him. The facts were that the respondent-company used to sell in the city of Bombay and its suburbs biscuits packed in tins on the understanding that in case the empty tins were returned to it within a period of 3 months the amount of deposit taken at the time of sale as the price of tins and kept in "deposit account returnable tins" would be refunded to the customers. A large number of the empty tins were not returned. There remained outstanding a sum of Rs. 1,68,027.05 in the foregoing account, namely, "deposit account returnable tins". At the end of the year the respondent-company wrote off half ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... power to protect purchasers from being subjected to an unlawful burden. Social justice clauses, integrally connected with the taxing provisions, cannot be viewed as a mere device or wanting in incidentality. Nor are we impressed with the contention turning on the dealer being an agent (or not) of the State vis-a-vis sales tax; and why should the State suspect when it obligates itself to return the moneys to the purchasers? We do not think it is more feasible for ordinary buyers to recover from the common run of dealers small sums than from Government. We expect a sensitive Government not to bluff but to hand back. So, we largely disagree with Ashoka Marketing Ltd. v. State of Bihar [1970] 26 STC 254 (SC); [1970] 3 SCR 455, while we generally agree with R. Abdul Quader & Co. [1964] 15 STC 403 (SC); [1964] 6 SCR 967. We must mention that the question as to whether an amount which is illegally collected as sales tax can be forfeited did not arise for consideration in Ashoka Marketing Ltd. v. State of Bihar [ 1970] 26 STC 254 (SC); [ 1970] 3 SCR 455." To sum up, we uphold the impugned orders dated October 31, 1995 and dismiss the revision petitions. We make no orders as to cost. Pe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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