Purchase turnover rules distinguish statutory levies from commission charges: market fee excluded, commission included, additional tax upheld.

Section 3-F of the U.P. Sales Tax Act, 1948 was held to permit additional tax on dealers covered by section 3-D despite section 3-D(4), because the later provision expanded the charging scheme. Market fee recoverable from purchasers under section 17(iii)(b) of the U.P. Krishi Utpadan Mandi Adhiniyam, 1964 was treated as a statutory levy authorised by law and therefore did not form part of the turnover of purchases for sales tax purposes. Commission paid to a commission agent in the market area was treated as a trade charge for services, not a statutory levy, and was included in purchase turnover.

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Issues: (i) Whether additional tax under section 3-F of the U.P. Sales Tax Act, 1948 could be levied on purchases of goods notified under section 3-D notwithstanding section 3-D(4); (ii) whether market fee payable under section 17(iii)(b) of the U.P. Krishi Utpadan Mandi Adhiniyam, 1964 formed part of the turnover of purchases for sales tax purposes; (iii) whether commission paid to a commission agent within the market area formed part of the turnover of purchases.

Issue (i): Whether additional tax under section 3-F of the U.P. Sales Tax Act, 1948 could be levied on purchases of goods notified under section 3-D notwithstanding section 3-D(4).

Analysis: Section 3-F expressly referred to dealers liable under section 3-D and imposed an additional tax on their total turnover beyond the specified limit. The subsequent enactment therefore modified the effect of section 3-D(4), which only prevented levy under other provisions of the Act in the absence of such later statutory expansion.

Conclusion: The additional tax could be levied and the contention against its levy failed.

Issue (ii): Whether market fee payable under section 17(iii)(b) of the U.P. Krishi Utpadan Mandi Adhiniyam, 1964 formed part of the turnover of purchases for sales tax purposes.

Analysis: The statutory scheme authorised the commission agent to realise market fee from the purchaser and to pay it to the market committee. Amounts which a dealer is authorised by law to recover from the purchaser as a statutory levy do not form part of the consideration for the purchase and cannot be included in taxable turnover.

Conclusion: The market fee did not form part of the turnover of purchases and its inclusion was unsustainable.

Issue (iii): Whether commission paid to a commission agent within the market area formed part of the turnover of purchases.

Analysis: The commission was a trade charge for services rendered by the commission agent and not a statutory levy payable to the Government or a statutory body. The regulatory provisions only fixed or restricted the chargeable commission and did not convert it into an amount excluded from consideration for the purchase.

Conclusion: The commission formed part of the turnover of purchases and its inclusion was upheld.

Final Conclusion: The appeal succeeded only to the extent that market fee could not be included in the purchase turnover, while the challenge to inclusion of commission and the objection to additional tax failed.

Ratio Decidendi: A sum realised from the purchaser pursuant to a statutory authorisation to recover a levy does not form part of taxable turnover, but a contractual or service-based commission charge remains part of the consideration for purchase.

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