Railway freight outside sale price cannot be added to taxable turnover for sales tax.

Railway freight separately paid by customers and not included in the price of goods sold could not be treated as part of the sale price for sales tax purposes. Sales tax is leviable only on the price of the goods sold, and the mere use of an f.o.r. destination quotation did not make the freight part of the taxable turnover. Relying on the Supreme Court authority cited in the judgment, the Punjab and Haryana HC held that such freight could not be brought to tax as part of the sale price, and the reference was answered in favour of the assessee.

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Issues: Whether railway freight, when not included in the price of goods sold, could be treated as part of the sale price and subjected to sales tax.

Analysis: The reference proceeded on the admitted position that railway freight was not made part of the price of the goods sold. Sales tax is leviable only on the price of the goods sold, and freight separately paid by customers cannot be brought into the taxable turnover merely because the quotation was f.o.r. destination. The view was supported by the Supreme Court decision referred to in the judgment.

Conclusion: Railway freight not forming part of the sale price could not be subjected to sales tax, and the question was answered in favour of the assessee.

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