Tax-free sales remain part of gross turnover for turnover tax under the Bengal Finance sales tax scheme.

Under the Bengal Finance (Sales Tax) Act, 1941, gross turnover is wider than taxable turnover and includes the full sale value of goods unless a specific deduction applies. Section 6 exempts declared tax-free goods from tax, but it does not remove their sale price from gross turnover. For turnover tax under section 6B, sales of goods declared tax-free under section 6 are therefore included in gross turnover, and any exclusion operates only where the statute expressly provides for it in computing taxable turnover or turnover tax liability.

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Issues: Whether, for levy of turnover tax under section 6B of the Bengal Finance (Sales Tax) Act, 1941, sales of goods declared tax-free under section 6 are to be included in the dealer's gross turnover.

Analysis: The scheme of the Act distinguishes between gross turnover and taxable turnover. Gross turnover is given a wide meaning and covers the entire turnover without deductions, while taxable turnover is arrived at only after specified deductions under section 5(2). Section 6 merely exempts specified goods from tax; it does not exclude their sale price from the dealer's turnover. Section 6B also levies turnover tax on that part of gross turnover that remains after deducting certain categories, including sales of goods declared tax-free under section 6. The statutory language therefore shows that tax-free sales are first included in gross turnover and then excluded only at the stage expressly provided for computing taxable turnover or turnover tax liability.

Conclusion: Sales of goods declared tax-free under section 6 are includible in gross turnover for the purpose of turnover tax under section 6B, and the contention to the contrary fails.

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