1983 (3) TMI 248 - HC - VAT and Sales Tax

Summary

Issues:
1. Inclusion of bending and cutting charges in taxable turnover.

Analysis:
The case involved an appeal by M/s. Hindustan Steel Limited against the Board of Revenue's decision to set aside the Appellate Assistant Commissioner's order and restore the assessing authority's revised order including bending and cutting charges in the taxable turnover for the assessment years 1965-66 to 1968-69. The Appellate Assistant Commissioner had initially upheld the assessee's contention that these charges were post-sale charges and not part of the taxable turnover.

The main issue was whether the bending and cutting charges collected by the assessee from customers should be included in the taxable turnover. The Court analyzed the nature of these charges, emphasizing that they were separate from the sale price, and were only collected from customers who required bending and cutting services for easy transport of the materials purchased. The Court highlighted specific clauses in the delivery orders indicating the independent nature of these charges and the separate bargain between the parties for such services.

The Court referred to previous case law to interpret the relevant provisions of the Tamil Nadu General Sales Tax Act. It distinguished the current case from a previous judgment regarding handling and loading charges, emphasizing the distinct agreement between the parties in the present situation for the payment of bending and cutting charges separately. The Court concluded that these charges were not part of the sale price and could not be included in the taxable turnover.

It was noted that the cutting and bending charges were collected separately from the sale price, and no sales tax was levied on these charges. Therefore, the Court disagreed with the Board of Revenue's decision and set it aside, restoring the Appellate Assistant Commissioner's order. The appeal by the assessee was allowed, and no costs were awarded in the matter.