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TMI Blog1975 (1) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... nclusion that the respondent was entitled to have a deduction of cartage and transport charges shown and recovered by him separately in his invoices from the turnover of sales determined for the periods under assessment?" The facts which have given rise to this reference are that the respondent-firm carries on the business of manufacturing bricks. The respondent-firm had entered into a contract with the Housing Commissioner, Bombay, of the Maharashtra Housing Board for the supply of bricks, the terms of which contract have been recorded in the undated letter of acceptance from the Housing Commissioner to the offer made by the respondent-firm by its letter dated 7th November, 1958. Under the said contract the respondent-firm had to supply ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner the respondent-firm splitted up the said rate of Rs. 48 per 1,000 kiln burnt bricks into two items, namely, Rs. 33.60 as the price of 1,000 bricks and Rs. 14.40 as the cartage for 1,000 bricks. The Housing Commissioner made payment of the amounts of the invoices submitted by the respondent firm without raising any objection to the splitting up of the price as aforesaid. In its assessment for the assessment periods 1st April, 1958, to 31st March, 1959, and 1st April, 1959, to 31st December, 1959, the respondent-firm contended that the amount Rs. 14.40 per 1,000 bricks charged as cartage in the invoices submitted by the respondent-firm should not be included in its turnover of sales. This contention of the respondent-firm was rejecte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowed as cash discount according to trade practice, but including any sum charged for anything done by the dealer in respect of goods at the time of or before delivery thereof, other than the cost of freight or delivery or the cost of installation when such cost is separately charged." Thus, under the said clause (14) the amount of valuable consideration which a dealer is entitled to receive from his purchaser under the contract of sale is the sale price. An item which is expressly to be excluded from the sale price by the terms of the said clause (14) is any sum allowed as cash discount according to trade practice. Under the said clause (14), however, if a dealer has to do anything in respect of the goods at the time of or before delive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arties have agreed upon is an all-inclusive price. Under the said contract it is clear that the delivery has to be effected by the seller, namely, the respondent-firm, at the various sites where the construction work of the Maharashtra Housing Board is taking place. Thus, the payment of freight is necessarily involved in the execution of the said contract. Since the various sites where the work of the Housing Board is taking place are situate in various localities, the amount of freight which would have to be paid in respect of delivery of each consignment would vary from site to site. In order not to leave the final price contingent either upon the varying freight dependent upon the distance travelled in order to effect delivery or depende ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of freight or delivery when such cost is separately charged. It was urged on behalf of the respondent-firm by Mr. B.C. Joshi that since the Housing Commissioner had raised no objection to splitting up the said Rs. 48 per 1,000 bricks into two items as aforesaid, it must necessarily follow that the contract between the parties was subsequently varied. There is, however, no plea of variation of the original contract between the parties at any time taken up by the respondent-firm nor is any such variation of the contract found as a matter of fact by the Tribunal. The mere acquiescence on the part of the Housing Commissioner to splitting up the rate of Rs. 48 per 1,000 bricks into the two aforesaid items after the contract has been executed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hould be paid for separately, that cost should not form part of "sale price" and that if, on the other hand, the parties agree that the "sale price" should be an all-inclusive price, that is, that the purchaser must bear all the costs up to the stage of installation of the goods purchased and on the responsibility of the seller, the legislature intended to include all those charges in the "sale price", and it accordingly answered the question in the negative. This decision was followed by the Madhya Pradesh High Court in Birla Jute Manufacturing Co. Ltd. v. Commissioner of Sales Tax, Madhya Pradesh, Indore[1972] 29 S.T.C. 639., in which a similar question arose for the determination of the court with reference to the definition of "sale pri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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