Subsidy under a regulatory pricing scheme excluded from sales turnover where only billed price was charged to purchasers.

A subsidy paid by the Central Government under a regulatory pricing scheme to a fertiliser manufacturer did not form part of turnover under the Andhra Pradesh General Sales Tax Act, because turnover is confined to the bill price or consideration actually charged for the sale. The sales were covered by bills, purchasers paid only the billed price, and there was no finding that any additional amount was collected from them. As the subsidy was computed on factors unrelated to any particular sale and was not paid on behalf of any purchaser, it was not a sum charged in respect of the sale and could not be included in taxable turnover.

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Issues: Whether subsidy received by a fertiliser manufacturer from the Central Government pool formed part of the dealer's turnover and was exigible to sales tax under the Andhra Pradesh General Sales Tax Act.

Analysis: The definition of turnover in section 2(s) of the Andhra Pradesh General Sales Tax Act, 1957, fastens tax on the amount set out in the bill of sale or the consideration actually charged for the sale. Here the sales were covered by bills, the purchasers paid only the billed price, and there was no finding that any additional amount was collected from purchasers. The subsidy was paid by the Central Government under a regulatory pricing scheme in the larger interest of the fertiliser industry and was computed on factors unrelated to any particular sale transaction. It was not paid on behalf of any purchaser and did not represent any sum charged in respect of the sale.

Conclusion: The subsidy did not form part of turnover and was not taxable as sales turnover under the Act; the inclusion of the subsidy in the assessment was unsustainable.

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