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TMI Blog2021 (4) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1956 (CST Act). 3. The Department of Telecommunications (DoT), Maharashtra Telecom Circle, Mumbai floated a tender on 30th April 1998, for supply of "cast iron socket-Socket 'B'." Clause 9 of the Bid Document stipulated the bid price. Clause 9.1 required the bidder to quote a basic unit price and other component prices individually in terms of the Schedule given in Section (iii). Clause 9.2 (i) provided that the bidder should quote the excise duty, sales tax, insurance, freight and other taxes paid or payable item wise. Clause 9.2 (ii) stipulated that the bidder had to quote the price as per the price schedule given in Section (iii) Part 3 for all the items given in the schedule of requirements. Clause 9.3 provided that the price quoted by the bidder would remain fixed during the entire period of the contract and should not be subjected to variation of any account. 4. Section (iii) Part-3 specified the separate items which were to be quoted by the bidder as under: (1) Basic Unit price (2) Excise Duty (3) Sales Tax (4) Freight (5) Any other levy (6) Unit price inclusive of all levies and charges (7) Discount (8) Total dues accounted price 5. It is stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould not be entitled to any deduction towards freight despite showing it separately in the sale invoice. 11. Thereafter, the Petitioner went before the Orissa Sales Tax Tribunal, Cuttack (the Tribunal) with S.A.35 (C) of 2002-03 against the above order. By an order dated 5th October 2009, the Tribunal dismissed the appeal holding that the transportation charges, even though shown separately in the bill, was includible in the sale price. It was held therein that in the instant case the place of sale was the consignee's place and hence, transportation cost incurred was the inward transportation cost of the Petitioner, but not outward transportation cost to be reimbursed by the DoT. 12. Mr. S. Ray, learned counsel for the Petitioner submitted that the definition of sale price under Section 2 (h) of the CST Act made it clear that the sale price excluded the cost of freight of delivery where such cost was separately charged. He further referred to the clauses in the contract which made it clear that the sale was completed inside the Petitioner's factory, once it was inspected by the DoT and the goods to be sold were earmarked for purchase. He pointed out that the Petitioner had transp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods it proposes to supply under the contract as per price schedule given in Section III. Prices of incidental services, if any, should be quoted. The offer shall be firm in Indian Rupees. No foreign exchange will be made available by the Purchaser. 9.2 Prices indicated on the Price Schedule shall be entered in the following manner: (i) The price of the goods shall be quoted inclusive of all levies, taxes and suitable required packing for safe and easy transportation. Excise Duty, Sales Tax, Insurance, freight and other taxes already paid or payable shall also be quoted separately, item wise. (ii) The Supplier shall quote as per price schedule given in Section III Part III for all the items given in schedule of requirement. 9.3 The prices quoted by the Bidder shall remain fixed during the entire period of contract and shall not be subject to variation on any account. A bid submitted with an adjustable price quotation will be treated as nonresponsive and rejected. 9.4 The unit prices quoted by the Bidder shall be in sufficient detail to enable the Purchaser to arrive at prices of goods/equipment/system offered. 9.5 Unless otherwise stated the rates shall be quoted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as well as the Tribunal. 21. Mr. S.S. Padhy, learned Additional Standing Counsel for the Opposite Party-Department placed heavy reliance on the following observations of the Tribunal in the impugned order: "The Unit price mentioned in the order itself is composite in nature without any break ups. Although the Bid documents submitted by the appellant in case of Mumbai order contained basic unit price, excise duty, Sales Tax, freight any other levy or charges and unit price inclusive of all levies and charges as Rs. 261.70, Rs. 39.26, Rs. 12.04, Rs. 45/-, Nil, and Rs. 358.00 respectively. The insurance charges are borne by the appellant till the goods are received by the consignee. The appellant was responsible for all kinds of losses i.e. loss due to theft, damage, shortages till before receipt of entire quantity of stores in good condition by the consignee. As would seen from the terms and conditions of the purchase order placed on the appellant the purchasers are not concerned about how much freight is incurred by the appellant in making goods available at the designated places and so also not concerned about any losses in theft, any loss or damage effected to the goods in bet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me freight charge irrespective of the distance between the factory of the Petitioner and the destination of the Purchaser. The crucial factor, which was missed, was that the rate was an uniform rate of Rs. 45 "per piece" as this was for a supply of 50000 units. In almost identical facts, the Supreme Court in State of Karnataka v. Bangalore Soft Drinks Pvt. Ltd. (supra) held that despite there being a uniform rate per unit as freight charge that still would not be included in the sale price. The following observations in the said decision are relevant: "No doubt, it is true that the revision petitioner has charged freight charges uniformly irrespective of the distance. For this the revision petitioner contended that it has charged uniform rate of Rs. 4 per crate with a view to maintain a uniform price of their product throughout their territory of operation and charging of such equalized price is a common trade practice. The petitioner in support of his contention placed reliance on a decision of this Court in the case of Premier Breweries Ltd. v. State of Karnataka reported in [1984] 56 STC 14. In this decision, this Court has approved the charging of uniform rate of freight char ..... X X X X Extracts X X X X X X X X Extracts X X X X
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