9911796707
TMI Blog1998 (7) TMI 656X X X X Extracts X X X X X X X X Extracts X X X X ..... pectively for the assessment year 1994-95. The assessing authority while completing assessment added back to the total turnover a sum of Rs. 3,47,685 which represents the discount allowed to the customer. By adding this to the total turnover the authority arrived at the figure of Rs. 13,25,959 and proposed to levy the turnover tax on the ground that the taxable turnover exceeds Rs. 10,00,000. The disputed tax element is Rs. 10,861. 3.. Appellant filed appeal under section 20 of the Karnataka Sales Tax Act, 1957 (hereinafter referred to as "the Act") challenging the levy of turnover tax and also inclusion of discount amount while calculating the total turnover. The first appellate authority allowed the appeal in full and set aside the turn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant contended that the trade discount/ cash discount does not form part of the sale price and as such it was not includable in the total turnover. Mr. D'Sa, has put in appearance for the State of Karnataka and supported the judgment under appeal. 6.. Cash discount is allowed when the purchaser makes payment promptly or within the period of credit allowed and it is granted in consideration of expeditious payment. A trade discount is a deduction from the catalogue price of goods allowed by wholesalers to retailers engaged in the trade. The trade discount or the cash discount does not enter into the composition of the sale price, but exists apart from and outside it and prior to it. Supreme Court while considering the point as to whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act, as aggregate amount for which the goods are bought or sold, supplied or distributed, either directly or through another, on his own account or on account of others, whether for cash or for deferred payment or other valuable consideration. As per explanation (ii) to this sub-section the amount for which the goods are sold include any sums charged for anything done by the dealer in respect of the goods sold at the time or before the delivery thereof. The word "total turnover" means aggregate turnover in all goods of a dealer at all places of business in the State whether or not the whole or any portion of such turnover is liable to tax. Taxable turnover has been defined as: "'Taxable turnover' means the turnover on which a dealer s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deration for the sale is to be taken as the taxable turnover. A combined reading of the definition of "taxable turnover" with rule 6(1)(b) leaves no manner of doubt that whatever prices were received by the dealer for the sale of goods would go towards the taxable turnover and the trade discount/cash discount given by the dealer to the purchasing dealer and not received by him, shall not be includable in the taxable turnover. The revisional authority was not justified in including the trade discount amount as the turnover for the purpose of section 6(1)(b) of the Act. Nothing can be treated as turnover which does not represent either sale price or the purchase price. The sale price or the purchase price is nothing but the price paid for goo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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