Sales tax on bottled beer and bottle deposits turns on separate billing, true sale character, and liquor classification.

Beer sold in bottles was not taxable on the combined price of beer and bottles under Item 22 where the charging entry did not cover bottled beer as such and the beer and bottle charges were separately billed. The bottle amount described as a deposit was treated as the sale price of the bottles because it was payable in advance, refundable on return, and imposed no obligation to return the containers; the transaction was therefore a sale of bottles liable to tax. Beer was also held to fall within "Indian-made foreign liquor" for Item 22 by reference to the corresponding excise definition, making it taxable under that entry.

---

---

Issues: (i) Whether the levy of sales tax on the total price of beer and bottles as bottled beer under Item 22 of the First Schedule to the Goa, Daman and Diu Sales Tax Act, 1964 was legal. (ii) Whether the amount taken from purchasers as a deposit for bottles was in substance the sale price of the bottles and whether the transaction amounted to a sale of bottles liable to tax. (iii) Whether beer fell within the expression "Indian-made foreign liquor" under Item 22 of the First Schedule to the Goa, Daman and Diu Sales Tax Act, 1964.

Issue (i): Whether the levy of sales tax on the total price of beer and bottles as bottled beer under Item 22 of the First Schedule to the Goa, Daman and Diu Sales Tax Act, 1964 was legal.

Analysis: Item 22 covered foreign liquor and Indian-made foreign liquor, but did not provide for taxation of bottled beer as such. The price list and course of dealing showed that beer was priced separately from bottles and that the bottles were separately billed. In that situation, taxation on the combined price of beer and bottles as though the sale were of bottled beer was not supported by the charging entry.

Conclusion: The levy on the total price of beer and bottles under Item 22 was not legal.

Issue (ii): Whether the amount taken from purchasers as a deposit for bottles was in substance the sale price of the bottles and whether the transaction amounted to a sale of bottles liable to tax.

Analysis: A sale under sales tax law requires an agreement to transfer title for consideration and an actual passing of property. The price list treated the bottle amount as payable in advance, made it refundable on return of empty bottles, did not impose any obligation on purchasers to return the bottles, and fixed no time for return. Mere description of the amount as a deposit did not alter its real character. On the true nature of the arrangement, the bottle amount was the price of the bottles, not a security deposit or bailment amount.

Conclusion: The amount was sale price of the bottles, and the transaction constituted a sale of bottles liable to tax under section 7(1)(c).

Issue (iii): Whether beer fell within the expression "Indian-made foreign liquor" under Item 22 of the First Schedule to the Goa, Daman and Diu Sales Tax Act, 1964.

Analysis: Although the sales tax statute did not define the expression, the corresponding excise statute defined Indian-made foreign liquor to include beer manufactured in India. Beer was therefore within the statutory concept of Indian-made foreign liquor and answerable to the charging entry in the Schedule.

Conclusion: Beer fell within the expression "Indian-made foreign liquor" and was taxable under Item 22.

Final Conclusion: The references were disposed of by holding that the combined levy on beer and bottles was impermissible, the bottle amount was nonetheless taxable as the price of bottles under the appropriate provision, and beer was classifiable as Indian-made foreign liquor for the purpose of the Schedule.

Ratio Decidendi: Where a so-called deposit for bottles is refundable only on return but the arrangement imposes no obligation to return the bottles and shows the bottle amount as payable in advance, the amount is the price of the bottles and not a true deposit.

---