Separately charged freight is excluded from taxable turnover under the U.P. Sales Tax Act.

Freight separately charged and paid by the principals was excluded from taxable turnover under the U.P. Sales Tax Act, 1948. The turnover definition covered the aggregate amount for which goods were sold, but its Explanation expressly excluded cost of freight or delivery when separately charged. Applying that statutory exclusion, the Court held that freight paid separately could not be added to the dealer's turnover. The inclusion of such freight in taxable turnover was therefore unsustainable.

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Issues: Whether freight charges separately charged and paid by the principals could be included in the dealer's taxable turnover under the U.P. Sales Tax Act, 1948.

Analysis: Clause (i) of Section 2 defines turnover as the aggregate amount for which goods are supplied or sold, and Explanation II to clause (i) expressly provides that the amount for which goods are sold includes sums charged for work done in respect of the goods at or before delivery, other than the cost of freight or delivery, cost of installation, or amounts realised as sales or purchase tax, when such cost or amount is separately charged. The statutory language shows that separately charged freight is excluded from turnover. On the facts, the freight was separately charged and paid by the principals, so it could not be added to the appellant's taxable turnover.

Conclusion: The inclusion of freight charges in the appellant's taxable turnover was unsustainable and the issue was decided in favour of the assessee.

Ratio Decidendi: Where freight is separately charged, it is excluded from taxable turnover under the statutory exclusion in the turnover definition.

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