Excise duty collected later still forms part of turnover where the levy attaches at production.

Rubber cess levied under the Rubber Act, 1947 is treated as a duty of excise on production, and its deferred collection does not alter its character. Because the levy attaches to rubber when produced and only the collection mechanism is postponed, the amount forms part of the commercial price. It is therefore includible in the dealers' purchase turnover under the Kerala General Sales Tax Act, 1963. The earlier contrary view was not accepted, and the operative principle is that the stage or person from whom an excise duty is collected does not change its incidence for turnover purposes.

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Issues: Whether the rubber cess payable under the Rubber Act, 1947 forms part of the purchase turnover of the dealers under the Kerala General Sales Tax Act, 1963.

Analysis: The turnover definition under the Kerala enactment is wide enough to cover the aggregate amount paid for goods bought, and the levy under section 12(1) of the Rubber Act is a duty of excise imposed on rubber at the stage of production. Section 12(2) and rule 33-D only regulate the manner and stage of collection and do not alter the character of the levy. The incidence of the cess attaches to the rubber when produced, and deferred collection from the manufacturer is merely a convenient machinery for recovery. The amount therefore enters the commercial price of the rubber and cannot be excluded from the purchase turnover. The earlier contrary view was not accepted, and the reasoning was supported by the principle that excise duty remains part of turnover even when collected later from a person other than the producer.

Conclusion: The cess payable under the Rubber Act, 1947 is includible in the dealers' purchase turnover under the Kerala General Sales Tax Act, 1963 and the answer is against the assessee.

Ratio Decidendi: A statutory excise duty levied on production remains part of turnover when its collection is deferred to a later stage from the purchaser or user, because the method of collection does not change the incidence or character of the levy.

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