Packing and forwarding charges are deductible only if they are post-sale expenses, not part of pre-sale sale price computation.

Packing and forwarding charges collected at a uniform rate per crate are deductible only if they represent freight or packing-related amounts not forming part of the sale price and incurred as post-sale expenses or incidents of sale after completion of the sale. The decisive inquiry is whether the expenditure was incurred before the sale to make goods available at the place of sale, or after the sale on behalf of the purchaser; invoice form alone is not conclusive. Uniform charging does not by itself establish that the amount is part of pre-sale expenditure. The assessing authority must determine the point of sale and the true nature of the charges on proper evidence.

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Issues: Whether packing and forwarding charges collected at a uniform rate per crate were deductible under rule 6(4)(f) and (ff) of the Karnataka Sales Tax Rules, 1957, or formed part of the sale price as pre-sale expenditure.

Analysis: The rules permit deduction only of freight or packing-related amounts that are not part of the price and are incurred as post-sale expenses or as incidents of sale after the sale is complete. The decisive enquiry is not the manner in which the invoice is framed, but whether the charges were incurred before the sale to make the goods available at the place of sale, or after the sale on behalf of the purchaser. Uniform charges by themselves do not conclusively show that the amount is unrelated to actual freight or handling expenses. On the facts, the authorities had proceeded on the assumption that the charges necessarily represented pre-sale activities, without adequately determining where the sale was completed and whether the amount was collected as an incident of sale.

Conclusion: The claim for deduction could not be rejected on the existing material, and the matter required reconsideration by the assessing authority after giving the petitioner an opportunity to adduce evidence.

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