Market fee recovered from the buyer was not turnover, so purchase tax could not be levied on that component.

Where the buyer was obliged to bear the market fee and the seller only recovered it, that amount was not the seller's liability and could not be treated as sale consideration or turnover under the Punjab General Sales Tax Act, 1948. Applying the turnover definition and the market-fee mechanism, the SC followed earlier decisions on the same levy and held that purchase tax could not be charged on the market-fee component. The State's challenge therefore failed, and the element of market fee was excluded from turnover for purchase tax purposes.

---

---

Issues: Whether purchase tax could be levied on the element of market fee on the footing that such amount did not form part of the turnover.

Analysis: The turnover definition under section 2(i) of the Punjab General Sales Tax Act, 1948 was considered along with the market fee mechanism under the relevant agricultural markets law. The governing principle applied was that where the buyer is under the obligation to bear the market fee and the seller merely realises it from the buyer, the amount does not represent a liability of the seller and cannot be treated as part of the sale consideration or turnover. The earlier decisions on the same levy were followed, and it was held that no sales tax could be charged on that component.

Conclusion: The element of market fee was held not to form part of the turnover for purchase tax purposes, and the challenge by the State failed.

---