Customs duty under a c.i.f. contract is not part of sale price when paid by buyers after sale completion.

Customs duty paid by buyers of imported goods under a c.i.f. contract does not form part of the sale price under the Bombay Sales Tax Act, 1959 or the Central Sales Tax Act, 1956 where the statutory definition covers only consideration paid or payable to the dealer and sums charged for acts done by the dealer before delivery. The sale was complete once the contractual consideration was paid and documents were delivered; the buyers then cleared the goods and paid customs duty as owners and importers. Because the duty liability rested on the buyers and arose after completion of the sale, it was not consideration flowing to the seller and could not be included in the seller's turnover.

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Issues: Whether customs duty paid by the buyer of imported goods under a c.i.f. contract formed part of the sale price for the purposes of sales tax under the Bombay Sales Tax Act, 1959 and the Central Sales Tax Act, 1956.

Analysis: The statutory definition of sale price extends only to the amount of valuable consideration paid or payable to the dealer and to sums charged for things done by the dealer in respect of the goods at or before delivery. On the facts, the sale was complete when the contractual consideration was paid and documents were delivered to the buyers. The buyers thereafter cleared the goods and paid customs duty in their capacity as owners of the goods and as importers within the meaning of the Customs Act, 1962. Since the contractual liability to pay customs duty was cast on the buyers and the duty was paid after the sale had been completed, it could not be treated as consideration flowing to the seller.

Conclusion: Customs duty paid by the buyers did not form part of the sale price and could not be included in the turnover of the assessee.

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