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TMI Blog1997 (9) TMI 490X X X X Extracts X X X X X X X X Extracts X X X X ..... he cost of the bottles; this would suggest the sale thereof more strongly than the intention to get them back upon bailment. It seems to us upon these facts and circumstances that there was really a sale of the bottles to the customers, the assessee buying back the empties from some customers. It is, therefore, that the assessee could show a refund of Rs. 11,62,974 out of the total amount of deposits, namely, Rs. 30,57,143. Had there been a bailment, which necessarily pre-supposes that the bailee was aware of the terms thereof, a larger refund would have been shown. X X X X Extracts X X X X X X X X Extracts X X X X ..... account was transferred to an account called the "Bottle Deposit Forfeited Account". The amount of bottle deposit receipts, returns and forfeiture were shown by the assessee thus: Rs. "1-4-1974-By Balance 6,84,152 Add : Deposits 30,57,143 37,41,295 Less : Refund 11,62,974 25,78,321 Less : Amount forfeited 16,55,355 Balance on 31-3-1975 9,22,966" 3. The Commercial Tax Officer treated the amount of Rs. 16,55,355, being the forfeited deposit amount aforestated, as a part of the assessee's sales realisations and taxed it. The Assistant Commissioner confirmed the order, as did the West Bengal Commercial Taxes Tribunal. The matter was carried to the West Bengal Taxation Tribunal, whose order is under appeal. Both Tribunals placed e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... invoice spoke of a deposit and the fact that so substantial a sum as Rs. 11 lakhs had been refunded from out of the Bottle Deposit Account to customers who returned the empties showed that there was only a bailment of the beer bottles to the customers. 5.. The United Breweries Ltd. case [1997] 105 STC 177 (SC); (1997) 3 SCC 530 decided by a Bench of three learned Judges, involved a brewer making and selling beer in bottles. In respect of the beer bottles the brewer had issued circulars to its buyers. Four things were found by this Court to emerge therefrom, namely- "(1) The refundable deposits were being collected on the bottles and the crates. (2) The appellant advised its customers to collect forty paise per bottle from the consumers as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been to sell the beer bottles; on the contrary, the brewer was trying to ensure that the bottles in which the beer was supplied to consumers through its customers were brought back to it so that they could be used again. It was in this context that it was said, "It does not appear that any time-limit was fixed for return of bottles in this case. But, even if such limit was fixed, it is well-settled that time is not of the essence of the contract unless the parties specifically make it so". 6.. In Raj Sheel v. State of Andhra Pradesh [1989] 74 STC 379 (SC); [1989] 3 SCC 262, this Court was again concerned with brewers who sold beer in bottles and the question was whether the bottles were exigible to sales tax. earned counsel for the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against each. Similarly where a deposit is made by the purchaser with the dealer, the deposit may be pursuant to a transaction where there is no sale of the container and its return is contemplated, and in the event of its not being returned the security is liable to forfeiture. Alternatively, it may be a case where the container is sold and the deposit represents the consideration for the sale, and in the event of the container being returned to the dealer the deposit is returned by way of consideration for the resale. In every case, the assessing authority is obliged to ascertain the true nature and character of the transaction upon a consideration of all the facts and circumstances pertaining to the transaction. That the problem almost ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to become liable to pay sales tax on the price or deposit realised therefor. 8.. The two factors that may be said to militate against the sale of the beer bottles are, first, the invoices that speak of the "deposit on bottles" and, secondly, the refund of Rs. 11,62,974 out of the aggregate amount of the deposits, namely, Rs. 30,57,143. 9.. Now, there is nothing on record which indicates that the terms under which the deposits would be repaid were communicated to the assessee's customers. There is no suggestion that there was an oral communication of such terms to the customers or that there was any trade usage in this behalf. It is difficult to visualise a bailment the terms whereof are not made known to the bailee. The forfeiture of amo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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