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TMI Blog2023 (1) TMI 1134X X X X Extracts X X X X X X X X Extracts X X X X ..... pacity as carrier of the goods and did not form part of the sales turnover of the petitioner. Even as per purchase order if the goods are delivered to SMD Jamshedpur, the same needs to be delivered free of delivery charges. Thus, the real intention can also be gathered by the Act of the seller and buyer. After going through the orders passed by the tax authorities it appears that the tax authorities as well as the learned tribunal misdirected themselves in reading only Explanation-II to Section 2(xlviii) of the JVAT Act and ignored Explanation-III which categorically indicates that the sale price shall not include the cost for transport of goods from the seller to the buyer provided such cost is separately charged to the buyer. Thus the orders of tax authorities as well as the learned tribunal suffer from illegality and incorrect application of the provision of the JVAT Act to the facts of the present case. The matter is remitted back to the Deputy Commissioner of Commercial Taxes, Singhbhum Circle, Jamshedpur to pass a fresh order on the claim of the petitioner to the extent it relates to freight charges realized by the petitioner from its purchasers and shown and charged se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of mandamus directing the Deputy Commissioner of Commercial Taxes, Singhbhum Circle, Jamshedpur to pass fresh order on the claim of the petitioner to the extent it relates to freight charges realized by the petitioner from its purchasers and shown and charged separately in the invoices after considering the materials an after hearing the petitioner within a stipulated time framed as may be fixed by this Hon ble Court. 3. The brief fact of the case is that the Petitioner is a Company, engaged in purchase and sale of ores and minerals, rocks, processed minerals, pyroxenite, duly registered under the provisions of JVAT Act. The Petitioner used to sell its finished products to various customers within the state and outside the state of Jharkhand including M/s Tata Steel Ltd. The goods were being supplied by the Petitioner pursuant to the Purchase orders issued from the parties including M/s Tata Steel Ltd. and there has been no written contract for sale between the Petitioner and its Purchaser. The petitioner is aggrievedby the order dated 10.09.2013 passed by the Assessing Officer who while making assessment for the period 2010-11 had included transportation cost (Rs.61,52,526 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orms a dual role, one as the seller of the goods and other as carrier of the goods, having collected freight charges separately from the buyer. The clause (3) of the purchase orders (Annexure-4 series) specifically states that the freight will be payable on actual, meaning thereby that the price of the goods is not inclusive of the transportation cost/freight. The freight charges were recovered by the petitioner in the capacity as carrier of the goods and did not form part of the sales turnover of the petitioner. It is further stated that as per purchase order if the goods are delivered to SMD Jamshedpur, the same need to be delivered free of delivery charges. She lastly submits that in view of the specific provisions and also the terms of contract, the order passed by the Tax authorities including that of the learned tribunal requires interference. 5. Mr. Yogesh Modi, learned A.C. to A.A.G.-1A submits that the petitioner has filed all returns and also VAT Audit report in form JVAT 409 according to which, after examining them, aggregate turnover of Rs. 1, 21,08,979.96 and transport receipt of Rs. 61, 52, 526.00 was found mentioned. He further submits that the petitioner buys and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the purchaser or any other person. Explanation II- Sale price shall include any amount charged by the dealer for anything done in respect of the goods at the time of, or before delivery thereof to the buyer. Explanation III- Sale price shall not include the cash discount, if shown separately; and allowed by the dealer in the ordinary course of trade practice. It shall also not include the cost for transport of the goods from the seller to the buyer, provided such cost is separately charged to the buyer. Explanation IV- For the purpose of this clause, the expression Sale price shall mean, the maximum retail price, as referred to in clause (xxxiii) of Section 2 of this Act, for a dealer, selling goods, specified in Drugs (Prices Control), Order, 1995 to any other dealer. Emphasis Supplied Thus, the definition of Sale price is the amount payable to a dealer as valuable consideration in respect of the sale or supply of goods. Further explanation attached to the said section deals with the inclusion and exclusion of the amount charged.Explanation-II says that any amount charged by the dealer for anything done in respect of goods at the time of or before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (3) of the purchase order (Annexure-4 series) specifically indicates that the freight will be payable at actual; meaning thereby, the price of the goods is not inclusive of the transportation cost/freight. Further, the freight charges were recovered by the petitioner in the capacity as carrier of the goods and did not form part of the sales turnover of the petitioner. Even as per purchase order if the goods are delivered to SMD Jamshedpur, the same needs to be delivered free of delivery charges. Thus, the real intention can also be gathered by the Act of the seller and buyer. It was never the intention of the parties viz the Petitioner and the Purchaser that freight charges were to form part of the sale price of goods sold by the Petitioner and for that purpose separate books were maintained, separate invoices were issued with respect to transportation bill and for sale of goods. Further, the present practice was being adopted by the Petitioner since 2005 and the Respondent Department duly accepted the said practice as evident from the earlier and subsequent Assessment Orders under JVAT Act. 10. In view of the aforesaid discussion and after going through the orders passed ..... 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