1948 (9) TMI 9 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Whether the sale price as defined in Section 2(h) of the Bengal Finance (Sales Tax) Act, 1941, includes any amount charged and realised separately as "sales tax" by the dealer.
2. Whether the gross turnover should be ascertained by including all amounts charged and realised as "sales tax" by the dealer.
3. Whether the deduction provided in Section 5(2)(b) entails that any amount charged and realised separately as sales tax by the dealer should be regarded as part of the sale price and included in the gross turnover.

Issue-wise Detailed Analysis:

Issue 1: Inclusion of Sales Tax in Sale Price
The Court was asked to determine if the sale price, as defined in Section 2(h) of the Bengal Finance (Sales Tax) Act, 1941, includes any amount charged and realised separately as sales tax by the dealer. The Court clarified that the question should be framed as: "Does the sale price as defined in Section 2(h) of the Bengal Finance (Sales Tax) Act, 1941, include any amount charged and realised separately as sales tax?" The Court held that the term "sale price" means the amount payable to a dealer as valuable consideration for the sale of goods, including any sum charged for anything done by the dealer in respect of the goods at the time of or before delivery. The Court concluded that the total amount paid by the buyer, which includes the sales tax, is the sale price under the Act. Therefore, the sale price does include any amount charged and realised separately as sales tax by the dealer.

Issue 2: Gross Turnover Calculation
The Court noted that the second question is essentially a repetition of the first. If the sale price includes the amount charged and realised separately as sales tax, then the gross turnover must be ascertained by taking the aggregate of the amounts of sale prices and parts of sale prices received by the dealer, including all amounts charged and realised as sales tax during the period in question. The Court affirmed that the gross turnover must include the aggregate of the sale prices, which encompasses the amounts received as sales tax.

Issue 3: Deduction under Section 5(2)(b)
The Court found the third question to be unnecessary and academic. The Court emphasized that hypothetical or academic questions should not be submitted to or answered by the Court. The deduction provided in Section 5(2)(b) does not alter the inclusion of sales tax in the sale price or gross turnover. Therefore, the Court decided not to answer this question as it was not necessary to dispose of the case.

Conclusion:
The Court answered the first question in the affirmative, stating that the sale price as defined in Section 2(h) of the Bengal Finance (Sales Tax) Act, 1941, does include any amount charged and realised separately as sales tax by the dealer. Consequently, the second question was also answered in the affirmative, confirming that the gross turnover should include all amounts charged and realised as sales tax by the dealer. The third question was deemed unnecessary and was not answered. The Board of Revenue was entitled to the costs of the reference, assessed at a consolidated sum of fifteen gold mohurs.