TMI Blog2015 (11) TMI 216X X X X Extracts X X X X X X X X Extracts X X X X ..... mutual discussion, some price variation is there in the shape of reduction of the value, then in my view, it cannot be said to be a case of reduction/discount as everything has happened after delivery which cannot be said to be price reduction or discount. In subsequent bills the amount was reduced by the purchaser on final settlement, then in that case, it was an inter-se dispute in between the assessee as well as the Oil Companies but in so far as the claim that sales tax was required to be paid on the lower value of ₹ 645/- per cylinder, in my view, cannot be said to be correct on the part of the assessee. - Decided against assessee. - S. B. Sales Tax Revision Petition Nos. 54, 57, 58, 59 of 2006 - - - Dated:- 27-2-2015 - RANKA J. K. J. Alkesh Sharma for the petitioner. R. B. Mathur and Ms Tanvi Sahai for the respondent. JUDGMENT These four sales tax revision petitions by the petitioner-assessee under Section 86 of the Rajasthan Sales Tax Act, 1994 (for short, 'RST Act, 1994') are directed against the order of the Tax Board and relate to the Assessment Years 1999-2000 2000-2001. 2. Since the facts and the controversy involved in all t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account of reduction in the purchase value from ₹ 682/- to ₹ 645/- per cylinder, the petitioner-assessee was entitled to claim rebate/refund of sales tax in the years aforesaid. It was claimed by the petitioner-assessee that the purchase order, initially placed at ₹ 682/-, was provisional and the petitioner-assessee paid due tax and later on by the letter dated 31/10/2000 the rate was revised and thus, the petitioner-assessee had no option except to request for reduction of the tax already paid as otherwise it has not only borne sales tax but has also suffered loss of ₹ 37/- per cylinder and accordingly a revised Return was filed to claim reduction on account of reduction in sale price. However, the Assessing Officer (for short, 'AO') did not allow the claim of the petitioner-assessee by observing that there is no provision under the Act for reducing the amount or claiming tax rebate once the amount having been deposited by the petitioner-assessee in the Government treasury. It was further contended that there was agreement/arrangement by the petitioner-assessee with the aforesaid three Companies and in so far as the sales tax is concerned, it had n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scount or rebate allowed is required to be reduced and contended that it was a discounted value at ₹ 645/- on which the assessee received the final amount. He further contended that similar position arose under the Central Excise Act and the matter travelled upto the Hon'ble Apex Court after having been allowed by the High Court and even the Supreme Court dismissed appeal of the Revenue. In support of his submission, he relied upon the judgments rendered in the case of Deputy Commissioner of Sales Tax (Law) Vs. Motor Industries Co.: 1983 (53) STC 48; The State of Andhra Pradesh Vs. T.V. Sundaram Iyengar Sons Ltd.: 1987 (65) STC 41; Bisra Stone Lime Co. Limited Vs. Sales Tax Officer: 1979 (44) STC 418; Bojaraj Textile Mills Ld. Vs. State of Tamil Nadu: 1990 (79) STC 82; Commercial Taxes Officer Vs. Ceat Tyres Of India: 1988 (68) STC 53; Commercial Taxes Officer Vs. Tata Oil Mills Ltd.: 1987 (67) STC 389; Commercial Taxes Officer Vs. Solkit Cosmetics: (2009) 25 Tax Update 65; Assistant Commissioner Vs. M/s. Vilas Udhyog: (2007) 18 Tax Update 184; State of Rajasthan and anr. Vs. Rajasthan Chemist Association: 2006 (15) Tax Update 261 and judgment of Single Bench of this Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in this purchase order, it was also stated that the assessee had to supply 73380 number of LPG cylinders by 31st August, 2000. It may be observed that out of the two assessment years, while for the assessment year 1999-2000, the financial year ended on 31/03/2000 whereas the purchase order placed by the assessee is dt.04/05/2000. So, by that date, the financial year for the assessment year 1999-2000 had already ended. It is true that the assessee also placed on record a subsequent letter, which has been referred to herein above dt.31/10/2000 by which the amount was reduced on the basis of price revision, after the Oil Companies having received the draft report from M/s Price Waterhouse Coopers. Therefore, in my view, there ought to have been some more material placed on record by the assessee prior to the date i.e. 01/07/1999 on which the rate was provisionally fixed at ₹ 682/-. It would be appropriate to quote the letter dt.04/05/2000 of the Indian Oil Corporation Limited placing purchase order to the petitioner-assessee, which reads ad infra:- UNIVERSAL CYLINDERS LTD Dated 4/5/2000 501, 508, VISHAL BHAVAN 95, NEHRU PLACE, NEW DELHI -110019. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng No.LPG/EQPT/2000/3084 dt.29/03/2000 (Ann.4-C) which is a purchase order for purchasing 29256 number of cylinders where the provisional price has been fixed at ₹ 700.58 per cylinder. It would be appropriate to quote the letter dt.31/10/2000 (Ann.4-D) issued by the Indian Oil Corporation Limited to the petitioner-assessee intimating that all supplies w.e.f. 01/11/2000 shall have the provisional basic price of ₹ 645/- per cylinder, which reads ad-infra:- Ref: LPG.O/M/2 Date: 31/10/2000 To, ALL LPG Cylinder Manufacturers Dear Sirs, Sub: PROVISIONAL PRICE OF LPG CYLINDERS As you are aware Industry has undertaken a study to review the existing cylinder pricing with the assistance of M/s Price Waterhouse Coopers. Accordingly, the price of 14.2 Kg LPG Cylinder was maintained provisional with effect from 01/07/1999. M/s Price Waterhouse Coopers have already submitted a draft report to Industry on the price revision. Pending finalisation of the report and the short time available to recover the cost due to the proposed cylinder tender, Industry has decided to revise the provisional basic price of 14.2 Kg cylinders to ₹ 645/- with effect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e deemed to be the sale price of such goods; Explanation II.-Where according to the terms of a contract, the cost of freight and other expenses in respect of the transportation of goods are incurred by the dealer for or on behalf of the buyer, such cost of freight and other expenses shall not be included in the sale price but the burden of such proof shall lie on the dealer. 14.2 Section 2(J) of the Central Sales Tax Act, 1956 defines 'turnover' as under:- turnover used in relation to any dealer liable to tax under this Act means the aggregate of the sale prices received and receivable by him in respect of sales of any goods in the course of inter-State trade or commerce made during any prescribed period and determined in accordance with the provisions of this Act and the rules made thereunder. 14.3 Section 2(44) of Rajasthan Sales Tax Act, 1994, defines 'turnover' as under:- turnover means the aggregate amount received or receivable by a dealer for sales as referred to in clause (38) including the purchase price of the goods which are subject to purchase tax under section 11 of the Act; Explanation : Tax charged or collected and shown s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e quality is not upto the mark and the goods needs to be returned back and after mutual discussion, some price variation is there in the shape of reduction of the value, then in my view, it cannot be said to be a case of reduction/discount as everything has happened after delivery which cannot be said to be price reduction or discount. As has been expressed earlier, if the value was reduced by the purchaser on the basis of some expert committee report and in subsequent bills the amount was reduced by the purchaser on final settlement, then in that case, it was an inter-se dispute in between the assessee as well as the Oil Companies but in so far as the claim that sales tax was required to be paid on the lower value of ₹ 645/- per cylinder, in my view, cannot be said to be correct on the part of the assessee. 18. The judgment relied upon by counsel for the assessee of the Hon'ble Supreme Court in the case of Deputy Commissioner of Sales Tax (Law) Vs. Motor Industries Co. was a case of additional trading discount called service discount which was over and above the normal trade discount in consideration of the extra business derived by the assessee by reason of the mar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the rate of the date of supply. This judgment is also inapplicable on facts. 22. This Court, in the case of Commercial Taxes Officer Vs. M/s L.G. Electronics India Ltd anr. (supra) was considering a case of a company which was manufacturing Refrigerators, TV, Washing Machines etc and was allowing discount on the occasion of festivals or on other occasions and other schemes as well. The assessee claimed that the sales tax is purportedly on the discounted price and not on the gross value of the items as ultimately, the assessee received only net value and was liable to pay the tax only on the net value. The said manufacturer was also selling goods of other manufacturers and granted discount on both the items, manufactured by it as well as the other manufacturers, however, in so far as the discount allowed by the assessee to its manufactured goods was concerned, the Revenue was satisfied but the Revenue objected to the discounted value having been taken on the items manufactured by other dealers and sold by the assessee and this Court, after considering the definition as given under the Sales Tax Law and considering judgments held that tax was leviable after the discount havi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the differential between the price on the date of removal and the reduced price at which tyres were sold at the direction of the Government. It was contended that the price list was approved on 14/05/1983 and subsequent thereto, on account of consumer resistance, the Ministry of Commerce, Government of India, directed them, pursuant to the decision taken at the meeting with tyre manufacturers, to roll back the price to pre 14/05/1983 level and it is on account of this roll back of prices that there came about a differential in the price on the basis of which the assessee claimed refund of excise duty to that extent and after analyzing the above facts, the Hon'ble Apex Court held ad-infra: Once the assessee has cleared the goods on the classification and price indicated by him at the time of the removal of the goods from the factory gate, the assessee becomes liable to payment of duty on that date and time and subsequent reduction in prices for whatever reason cannot be a matter of concern to the Central Excise Department insofar as the liability to payment of excise duty was concerned. This is the view which was taken by the Tribunal in the case of Indo Hacks Ltd. v. Coll ..... X X X X Extracts X X X X X X X X Extracts X X X X
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