TMI Blog1981 (1) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... t, 1961 ? " The assessee is a resident company and the assessment year involved is 1968-69. The relevant accounting period was the financial year which ended on 31st March, 1968. In this accounting period, the assessee had transferred a sum of Rs. 76,103 from the Central sales tax account to an unclaimed deposit account. The amount represented what remained of the sales tax collected by the assessee from its customers during a long period past but not paid to the Government. The ITO held that the sales tax collected by the assessee formed part of the trading receipts and as corresponding amounts had been originally allowed on the assumption that the assessee had an equivalent sales tax liability, any amount no longer payable on account of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sales effected by it as auctioneer, the assessee realised during the relevant period, in addition to the commission, Rs. 32,986 as sales tax. This amount was credited separately in its account under the head " Sales Tax Collection Account ". The assessee did not pay the amount of sales tax to the actual owner of the goods nor did it deposit the amount realised by it as sales tax to the State Exchequer because it took the position that the statutory provision creating that liability upon it having failed it was liable to be refunded to the person from whom it had been collected. The assessee also did not refund the money from whom he had collected. In the cash memos issued by the appellant to the purchasers in the auction sales the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... right to recover from his customers an amount equivalent to the sales tax payable by him but he was not obliged to do so. The liability to pay sales tax was solely of the dealer whether he realised such tax from his customers or not. Therefore, the tax charged by the dealer from his customer was in reality a part of the sale price and as such it would be revenue receipt. It was held that where a dealer collected the sales tax as such from his customers but only paid a portion of that amount to the sales tax department, the balance of that amount would be the revenue income in the hands of the assessee-dealer chargeable to income-tax and it was further held that as and when this amount was paid to the Government it would be allowed to the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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