1970 (4) TMI 123 - SC - VAT and Sales Tax

Whether the company charged any profit apart from storage charges for supplying cement and structural steel? Whether the difference between the price charged to the contractors and the price paid by the company to its suppliers for bricks was not in respect of storage and other incidental charges? Held that - Appeal allowed & order passed by the High Court is set aside. In the case of bricks on the evidence the cost price of bricks supplied to the contractors worked out to Rs. 39-8-0 and the company had charged Rs. 40 per thousand. But in working out the average rate of Rs. 39-8-0 the overhead expenditure of management for work-charged personnel was to be taken into account and it was not possible to determine the exact transport charges. We agree with the Tribunal that even in respect of the bricks the rate of Rs. 40 per thousand charged by the company did not leave any profit to it.

Summary

The Supreme Court found that the company did not charge any profit for supplying cement, structural steel, and bricks to contractors. The court held that the company did not make any profit from these transactions. The appeals were allowed, and the High Court's order was set aside. No costs were awarded.