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TMI Blog1971 (7) TMI 152X X X X Extracts X X X X X X X X Extracts X X X X ..... 964-65 and 1966-67, calling upon the petitioners to state as to why the cost of the packing material used in the course of the petitioner's business be not included in the assessable turnover and such cost of packing material not having been included earlier, why steps should not be taken to revise the said assessments. The petitioners objected to the said proposal on the ground that the cost of packing material and the incidental labour cost connected with it are specifically excluded from being included in the assessable turnover under the rules then in force prior to 9th March, 1964, as well as under rule 6(cc) of the Tamil Nadu General Sales Tax Rules, 1959. Reliance was placed upon a decision of this court in Dalmia Cement (Bharat) Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he subject-matter of sale wherein the dealer is obliged to pack the same and charge for it. In the former case, the question will not arise. But in the latter case, where the intention is clear that the packing of the cement was done pursuant to the contract between the parties and that such packing was undertaken at the instance of the buyer, then it follows that the turnover relating to such packing charges which could be reckoned from the bills of sale themselves are necessarily to be excluded from the assessable turnover. That, in the instant cases, the value of such packing charges were shown separately in the sale bills is not in dispute. On this basis, and on the strength of the decision in Dalmia Cement (Bharat) Ltd. v. Deputy Comme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unable to agree with the learned Government Pleader that the ratio in the said case would effectively override the principles laid down in Dalmia Cement (Bharat) Ltd. v. Deputy Commercial Tax Officer[1969] 23 S.T.C. 355. That case dealt with liquor. Liquor at any stage cannot be handled unless it is packed. Therefore, in those circumstances, the Supreme Court thought of making a distinction between one product and another, according to the nature inhered in it. In a case where the manufactured product has to be necessarily bottled, packed or bagged after the sale, when the dealer undertakes to transport the goods and to deliver the same to the buyer or where the expenditure is incurred as an incident of sale, then it would be excludable, bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmodity of cement. I respectfully follow the ratio in the said decision and hold that the petitioners are entitled to the relief even at the threshold. This conclusion is also possible factually. It is not disputed that cement at the material point of time was a controlled commodity. The policy prevalent at the time required that the consumers of cement should indent their requirements and apply to the authorised official like the Director of Industries and Commerce in the State and other such officers elsewhere for the purpose of allotment to them of such cement required for their purposes. If the allotment is made, the letters of allotment are passed on to the State Trading Corporation of India, who would issue delivery orders to the ceme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal to the sale of his manufactured commodity to his customers. If in the course of such an intention, he secures these gunny bags and if ultimately he uses them as packing material at the behest of the notified customer for the purpose of selling the said cement so bagged to him, it cannot be said that in such a transaction, the amount representing the value of packing materials separately charged would form a component part of the price. As a matter of fact, the Supreme Court in Dyer Meakin Breweries Ltd. v. State of Kerala[1970] 26 S.T.C. 248 (S.C.). uses the expression that the rule, similar to the one which was considered by their Lordships in that case, sought to exclude from the assessable turnover those charges which are incurred by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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