9911796707
TMI Blog1976 (1) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... the bills issued included interest charges and Hundi charges. The STO held that the amounts shown as interest charges and Hundi charges ought to have been included in the turnover of sales as they form part of the sale price. In an appeal against this finding, the Asstt. Commissioner upheld the same. It is against this finding and order that the present second appeal is filed. 3. The facts material for the purpose of the present second appeal are briefly as follows. It is common ground that in the transaction in question, the bill issued by the appellant for the sales states the headings "interest charges and Hindu charges", and the amounts of these items are included in the amount of the bill charged to the purchaser. A specimen of suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ler in respect of the goods at the time of or before delivery of the goods. In the present case, it is common ground that interest charges or Hindu charges are not related to anything done to the goods at the time of or before delivery thereof. The crux of the matter therefore, is whether interest charges and Hundi charges can be said to be consideration paid or payable for the sale made by the dealer. For a proper decision in the matter, it is requisite to duly scan and analyse the agreement and contract of sale. The compilation provided contains a letter sent by the purchaser Tata Enng. Locomotive Co. Ltd. dt. 24th Oct., 1967 (page 9 of the compilation). This letter is not the final contract. The contract is concluded by a subsequent do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cility mutually agreed upon between the parties as regards the mode of the payment of the balance of the sale price. Considering the ten or of the document, the clear stipulations in the same and the nature of the transaction, what clearly appears is as follows. The parties first set out the stipulation as regards the sale price proper. Therefore, the parties proceeded to stipulate the mode of the payment of the sale price. A part was to be paid at the time of the placing of the order. A second part was to be paid on arrival of the machines at site and their approval. 7. Thereafter the stipulation envisaged the mode of the payment of the balance of the sale price. It is obvious that the parties intended that in respect of the payment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the compilation). In this letter, the vendor the present assessee intimates the vendee, "kindly communicate to your Bombay office your acceptance and approval of the stores to enable us to complete the payment formalities." This again demonstrates that the mode of payment was regarded as a formality. Interest charges or the resultant Hundi charges therefore do not form part of the sale price. Such charges merely relate to the mode of the payment of the sale price agreed upon by the parties in a particular case. Ina given case the parties may adopt the mode of a lumpsum initial payment at the time of the delivery of the goods. In such a case no question of interest charges might arise. The distinction between to sale price proper and char ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said case. Secondly, there was an admission of the assessee that the items in question were added to the purchase price and were a part of the aggregate amount realised from buyers. The position in the present case is distinct. On the facts in the present case, which has been fully analysed at the outset, it is clear that the amount of interest charges and Hundi charges cannot be held to be a part of the sale price. Secondly, in the present case there is no admission anywhere that such charges were added as part of the sale price proper. On the other hand, in the present case as discussed above, the material adduced on the record clearly points to the position that the sale price was treated as distinct from items such as interest charg ..... X X X X Extracts X X X X X X X X Extracts X X X X
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