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TMI Blog1984 (1) TMI 290X X X X Extracts X X X X X X X X Extracts X X X X ..... f Madurantakam Co-operative Sugar Mills Ltd. These four cases relate to the assessment years 1973-74 and 1974-75 in respect of both the sugar mills. Tax (Revision) Case No. 581 of 1978 is in respect of the assessment under the Additional Sales Tax Act for the assessment year 1974-75 in relation to Madurantakam Co-operative Sugar Mills Ltd. 2.. The common question for decision in these cases is whether the turnover referable to the payment of transport charges is eligible for deduction from the purchase turnover of the petitioners. The petitioners are co-operative sugar mills. They purchase sugarcane from the growers for the purpose of manufacturing sugar therefrom. The minimum price payable for the purchase of sugarcane by the sugar mills ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State Government from time to time and the purchase turnover was worked out with reference to the quantity and price per metric ton as fixed by the Government, though the mills were at liberty to recover the transport charges incurred by them from the sugarcane growers. In this view, the mills or the factories were held not entitled to reduce the cane price fixed by the Government statutorily by deducting the amounts incurred by the mills or factories for making transport arrangements for the sugarcane growers. On further appeal to the Tribunal, on a consideration of the applications made by the sugarcane growers for registration and also the agreements entered into by them with the mills or the factories, the Tribunal found that the sugar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r fields in modification of the contract earlier entered into and on such delivery the property in the sugarcane passed to the petitioners and the transport charges incurred by the petitioners would readily be in the nature of post-purchase expenses and therefore, such amounts will not form part of the purchase price. In support of this, reliance was placed by the learned counsel for the petitioners on the decisions in State of Tamil Nadu v. Madurantakam Co-operative Sugar Mills [1976] 38 STC 238, Gwalior Rayon Silk Manufacturing and Weaving Co. Ltd. v. State of Tamil Nadu [1982] 49 STC 73, Hyderabad Asbestos Cement Products Ltd. v. State of Andhra Pradesh [1969] 24 STC 487 (SC), Hindustan Sugar Mills Ltd. v. State of Rajasthan and J.K. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses, the full statutory price is made available to the sugarcane growers. However, a majority of the sugarcane growers do not command transport facilities and they transport sugarcane in the lorries arranged by the mills or factories and in those cases, the transport charges are paid by the mills and deducted from the amount payable to the sugarcane growers. The petitioners claimed that those amounts representing transport charges should be reduced from the purchase price as arrived at by computing it with reference to the statutory fixation and the balance alone should be treated as the purchase turnover liable to tax. How far such a claim is justified has to be seen. 5.. The specimen forms of application for registration of the grower o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orries to the growers for facilitating delivery. But there is nothing to indicate that there was any departure from the terms of the contract relating to delivery. The sending of lorries by the mills or factories was only to help or facilitate the sugarcane growers to engage and load the lorries at appropriate times in order that the quality of the sugarcane may not deteriorate and also to ensure a steady inflow of sugarcane into the mills or factories depending upon their crushing schedule. There is nothing to show that the sugarcane growers sold the sugarcane and the petitioners purchased it in the fields as claimed by them. Indeed, it is seen from the contract lorry allotment register produced before the Tribunal that the lorry was allot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . It is seen that in respect of supplies effected by a sugarcane grower, the bill is prepared for the gross amount of the purchase price in accordance with the statutory price fixed by the Government. Any additional sugarcane price allowed to the sugarcane grower is subsequently given credit to separately. From the price of sugarcane so arrived at, lorry charges, share money, recovery of loan (principal and interest, etc.) are deducted and the net amount payable is arrived at. The bill is passed for the gross amount and the net amount. This also indicates that at all times, the mills or the factories recognised only the statutory price as the purchase price of sugarcane and the transport or other charges have been regarded as amounts payabl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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