Excise duty paid after sale is not part of purchase turnover unless the contract makes it consideration.

Excise duty paid by a buyer after purchasing non-duty-paid tobacco was treated as the buyer's own statutory liability and not part of the price paid to the seller. On that basis, the sales tax turnover was confined to the purchase price agreed in the contract, and post-sale duty payment did not enter the sale consideration unless the contract expressly or impliedly so provided. The analysis also relied on Sale of Goods Act principles on price and consideration. The assessment including the excise duty component was held unsustainable, and the writ petition succeeded.

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Issues: Whether excise duty paid by the buyer after purchasing non-duty-paid tobacco formed part of the purchase turnover for sales tax purposes.

Analysis: The tobacco purchased was excisable goods, and under the excise rules the petitioner was liable to pay the duty when it removed the goods from its licensed warehouse. The taxable turnover under the sales tax scheme was the amount for which the tobacco was bought, meaning the purchase price paid to the seller. Excise duty paid later by the buyer in discharge of its own statutory liability was not, without an express or implied stipulation in the contract, part of the consideration paid to the seller or part of the price of the goods. The surrounding provisions of the Sale of Goods Act, including the rules on price, unpaid seller rights, and the statutory treatment of duty changes, supported the view that post-sale payment of duty by the buyer did not automatically become part of the contract price.

Conclusion: The excise duty paid by the buyer was not includible in its taxable turnover. The assessment order including that amount was unsustainable and the writ petition succeeded.

Ratio Decidendi: Where goods are sold non-duty-paid and the buyer later pays excise duty in discharge of its own statutory liability, such duty does not form part of the sale price or purchase turnover unless the contract of sale expressly or impliedly makes it part of the consideration.

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