Purchase tax on mohua flower upheld alongside compounding tax for outstill liquor under rule 90-B.

Purchase tax remained leviable on the turnover of mohua flower even though compounding tax was payable under rule 90-B on sale of outstill liquor. The court treated mohua flower and outstill liquor as different commodities, with mohua flower only an ingredient used in manufacture. Rule 90-B was confined to a convenient method of computing the turnover of sale of outstill liquor and did not alter the taxability of either commodity. The appellate authorities erred in using that rule to exclude mohua flower from the tax net, so purchase tax on mohua flower stood in addition to the compounding levy.

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Issues: Whether purchase tax was leviable on the turnover of purchase of mohua flower in addition to the compounding tax payable under rule 90-B for sale of outstill liquor.

Analysis: Mohua flower and outstill liquor were held to be different commodities, with mohua flower constituting only an ingredient in the manufacture of outstill liquor. The purchase turnover of mohua flower remained exigible to tax even after the turnover of sale of outstill liquor became taxable from 1 May 1976. Rule 90-B was treated as a convenient method for computing the turnover of sale of outstill liquor and not as a provision affecting the taxability of either outstill liquor or mohua flower. The appellate authorities had erred in using rule 90-B to exclude mohua flower from the tax net.

Conclusion: Purchase tax was leviable on the turnover of purchase of mohua flower in addition to the compounding tax payable under rule 90-B.

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