TMI Blog2008 (7) TMI 856X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot sustain the findings and conclusions reached by the appellate authority and the Appellate Tribunal. Accordingly, revision petitions filed by the Revenue require to be allowed and they are allowed. The questions of law framed by the Revenue are answered in favour of the Revenue and against the assessees-dealers. - - - - - Dated:- 29-7-2008 - DATTU H.L. C.J. AND BASHEER A.K. , JJ. ORDER:- The order of the court was made by H.L. DATTU C.J. In these revision petitions, the primary question that would arise for our consideration and consequent decision is, whether the Appellate Tribunal was justified in directing the assessing authority to allow deductions towards mortality and weight loss during the transportation of chicken, while quantifying the sales tax liability under the provisions of the Kerala General Sales Tax Act, 1963 read with the Kerala General Sales Tax Rules, 1963? In these revision petitions, the assessees are dealers in live chicken and the assessments for several assessment years in question were completed by the assessing authorities by resorting to the best judgment assessment, since they have found that the books of account and the annua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties is required to be followed by the assessee. Having taken up all these contentions, the assessee has still filed the revised returns, conceding the sales turnover as per the delivery note and in that has claimed deduction towards the mortality and weight loss of the chicken. This claim is rejected by the assessing authority and has quantified the tax payable under the Act by passing the best judgment assessment. The order passed by the assessing authority is as under: I have examined the contention raised by the assessee. The revised return filed revealed the following: Live chicken sales as per delivery note value : Rs. 25,25,55,000.00 Less weight loss, death and price difference : Rs. 8,07,09,238.08 Net sales The value declared in the delivery notes used for transporting the goods from purchasing point is always the purchase value of goods. : Rs. 17,18,45,761.92 Approximate value is entered in delivery notes only in cases where correct value at the point where consignment begins is not ascertainable. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... value as per the delivery notes : Rs. 25,25,55,000 Add five per cent for freight, coolies and G.P. : Rs. 1,26,27,750 Total turnover estimated : Rs. 26,51,82,750 Less exemption allowed : Nil Taxable turnover proposed : Rs. 26,51,82,750 ST due at eight per cent : Rs. 2,12,14,620 AST due at 15 per cent : Rs. 31,82,193 Total tax due : Rs. 2,43,96,813 ST paid : Rs. 1,51,71,749 Balance due This shall be paid. Demand notice is issued. Interest due under section 23(3A) shall also be paid. : Rs. 92,25,064 In the appeal filed against the said order, the first appellate authority while modifying the best judgment assessment order passed, has observed as under: As I have al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eached by the Tribunal is as under: We have examined the facts of the case. The first contention raised by the assessee for the years 2001-02 and 2002-03 is that the mortality and weight loss restricted to 15 per cent by the first appellate authority is unjustifiable. The assessing officer has adopted the value shown in the delivery note for assessment purpose. The first appellate authority has restricted the claim of mortality and weight loss to 15 per cent. According to the authorised representative of the assessee the value quoted in the delivery note was an approximate value dictated by the departmental authorities and that the actual value was shown in the bills. Weight loss and death loss contributed to the difference between the sale value as per delivery notes and the value as per sales bills. It is contended that there is absolutely no material to establish that the respondent had in fact received more than what has been recorded in the sale bills. The authorised representative has relied on the decision of this Tribunal in T.A. Nos. 399 and 400 of 2004 and C.O. Nos. 24 and 25 of 2004 dated November 22, 2004 in support of his contentions. We find force in the content ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y and weight loss perverse especially since evidently the consignment is sold in excess of the purchase value and the assessee is not entitled to any deduction in turnover for weight loss and mortality? We have heard Sri Vinod Chandran, the learned Government Advocate for the Revenue and Dr. Mohammed Kutty, learned Senior Counsel and Sri Harishankar V. Menon, learned counsel for the assessees in all these tax revision cases. The learned counsel for the dealers while justifying the order passed by the Tribunal, would submit, that, the assessing authority has considered the purchase value as per the delivery note produced at the check-post as the turnover of the dealer and the same is impermissible in law and contrary to the statutory provisions. It is next contended that the assessing authority had failed to consider the fact, that, while transporting live chicken there will be mortality as well as weight loss and this omission has been corrected by the Appellate Tribunal and therefore, the Tribunal has not committed any error of law, which calls for interference by this court. The learned counsel for the assessee would further submit, that the assessees have accounted the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ler to mean, any person who carries on the business of buying, selling, supplying, distributing goods directly or otherwise, whether for cash or for deferred payment, or for commission, remuneration or other valuable consideration. Section 2(xxi) defines the word sale to mean, every transfer of property in goods, by one person to another in the course of trade or business for cash or deferred payment or other valuable consideration, but does not include a mortgage, hypothecation, charge or pledge. Section 2(xxvii) defines turnover to mean, the aggregate amount for which the goods are either bought or sold, supplied or distributed by a dealer, on his own account or on account of others, whether for cash or deferred payment or other valuable consideration. Section 2(xxvi) defines the meaning of the expression total turnover to mean, 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, including the turnover of purchase or sale in or in the course of export of the goods out of the territory of India or in the course of import of goods into the territory of India. Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s cannot be accepted by us, while considering a revision petition. The check-post declarations are public documents and therefore, they are presumed to be correct, unless it is proved otherwise. The assessee in the present case, in the original return filed for the assessment years in question, had shown the total and taxable turnover in a sum of Rs. 17,18,45,761.92. The returns so filed is not accepted by the assessing authority, rightly, so, since the assessee himself had shown the purchase value of live chicken in the delivery notes produced before the check-post authorities in a sum of Rs. 25,25,55,000. When the same was brought to the notice of the assessee by issuing pre-assessment notice, the assessee had filed revised return showing the sale value of the live chicken as per the delivery note value in a sum of Rs. 25,25,55,000 and had claimed deduction in a sum of Rs. 8,07,09,238.08 towards weight loss, death (mortality) and price difference and had offered a sum of Rs. 17,18,45,761.92 as the net sales for the purpose of taxation under the KGST Act. The assessing authority has disallowed the claim of the assessee for deduction from the total turnover, the weight loss an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the turnover relating to sales in the course of inter-State trade or of export or import. The total turnover means the aggregate turnover in all goods of a dealer at all places of business in the State. The taxable turnover means that part of the dealer's gross turnover which remains after allowing deductions that are permissible under rule 9 of the Rules. Rule 9 specifies various deductions which are to be excluded from the taxable turnover. Rule 9 of the KGST Rules, which has been framed with reference to section 5 of the Act read with section 2(xxv) of the Act, lays down that, in calculating the taxable turnover, the dealer may deduct from his gross turnover, the amounts specified in clauses (a) to (k) from his total turnover. The sub-clauses under the Rules do not provide for deduction of any amounts towards the weight loss or death of purchased commodity while calculating the taxable turnover of a dealer under the Act. The only relevant question to ask is, as to what is the amount paid by the dealer as consideration for purchase and not as to what is the net consideration retainable by the dealer. What could be included in the turnover is only the real sale pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nion that there is every possibility of death loss, weight loss during transportation of the purchased live chicken, have granted deductions and have directed the assessing authority to quantify the sales tax payable under the Act. This reasoning of the first appellate authority and Tribunal, in our opinion, is difficult to accept for the reason, the permissible deductions in the sales tax turnover for the purpose of arriving at taxable turnover, are only those deductions which are envisaged under sub-clauses (a) to (k) of rule 9 of the Rules. Sales tax is payable on the real price received or receivable by the dealer in respect of a sale. A dealer is entitled to frame his price structure in a manner conducive to the type of his business. He may base his price structure so as to take care of weight loss and mortality of chicken. But when it comes to taxation under the KGST Act, whatever amounts agreed to be paid to the seller from the buyer should be considered as consideration for the sale and requires to be subjected to tax, after giving those deductions that are provided under the Act and the Rules framed thereunder and no other deductions can be allowed while computing the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
