Freight separately charged under contract may be excluded from turnover when the purchaser bears the freight liability.

Where the contract made the purchaser liable to bear freight and the freight was in fact paid by the purchaser on delivery, the amount was treated as separately charged. The invoices showed a gross price, deduction of freight, and discount calculated on the balance, supporting the finding that freight did not form part of the sale price. On that basis, the freight amount was excluded from turnover and the assessment was decided in favour of the assessee, distinguishing cases where freight was neither separately charged nor contractually payable by the purchaser.

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Issues: Whether the freight amount was separately charged by the seller and could therefore be excluded from the turnover.

Analysis: The assessee's invoices first mentioned the gross price and then deducted freight, after which discount was calculated on the balance. The factual finding was that freight was invariably paid by the purchasers at delivery. On that basis, the freight liability was treated as that of the purchasers under the contract between the parties. The case was thus treated as distinguishable from decisions where freight had not been separately charged and the purchaser was under no contractual liability to pay it.

Conclusion: The freight was deemed to have been separately charged and was rightly excluded from the turnover, in favour of the assessee.

Ratio Decidendi: Where the purchaser is contractually liable to bear freight and the freight is in fact paid by the purchaser, the amount is treated as separately charged and need not form part of the sale price or turnover.

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