First sale levy on contractor bamboo sales and inclusion of recovered transport charges in taxable turnover upheld.

Sales of bamboos by contractors were treated as the first sale under item 75 of the First Schedule to the Andhra Pradesh General Sales Tax Act, 1957, because Explanation V, as amended, brought such sales within the first-sale levy. The contention that the Forest Department was the first seller was inconsistent with the amended statutory scheme. Transport charges incurred by the assessee and recovered from the buyer were also included in taxable turnover, as the definition of "turnover" in section 2(s) was held wide enough to cover such charges. Both challenges failed, and the tax revision was held unsustainable.

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Issues: (i) Whether the sale of bamboos by the assessee to the paper mill constituted the first sale liable to tax under item 75 of the First Schedule to the Andhra Pradesh General Sales Tax Act, 1957. (ii) Whether transport charges incurred by the assessee and passed on to the buyer formed part of the taxable turnover.

Issue (i): Whether the sale of bamboos by the assessee to the paper mill constituted the first sale liable to tax under item 75 of the First Schedule to the Andhra Pradesh General Sales Tax Act, 1957.

Analysis: Explanation V to the First Schedule, introduced by amendment, treated such sales by contractors as first sales. The assessee's contention that the Forest Department was the first seller was therefore inconsistent with the amended scheme of the Schedule.

Conclusion: The sale was the first sale and was liable to tax under item 75.

Issue (ii): Whether transport charges incurred by the assessee and passed on to the buyer formed part of the taxable turnover.

Analysis: The definition of "turnover" in section 2(s) of the Act was held to be wide enough to include transport charges incurred by the assessee and recovered from the buyer.

Conclusion: The transport charges formed part of the taxable turnover.

Final Conclusion: Both contentions failed, and the tax revision was not sustainable.

Ratio Decidendi: Where the statutory scheme expressly treats contractor sales as first sales, and the turnover definition is wide enough to include recovered transport charges, both the sale liability and inclusion of those charges in turnover must be upheld.

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