Freight deduction under sales tax rules depends on whether the expense is post-sale and incurred for the purchaser.

Rule 6(4)(f) of the Karnataka Sales Tax Rules allows deduction for freight only where the amount is actually incurred under that head, separately specified and charged without forming part of the sale price. The decisive test is the real character of the freight expenditure, not mere separate billing. Freight incurred before sale, or incidental to acquisition and making the goods available for sale, forms part of the dealer's cost and is not deductible. Deduction is available only for post-sale freight incurred for and on behalf of the purchaser, and the application of the rule depends on the facts of each case.

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Issues: Whether the exemption under rule 6(4)(f) of the Karnataka Sales Tax Rules, 1957, is available to a dealer in all circumstances, or whether its availability depends on the nature of the freight expenditure and the principles laid down in the Supreme Court decisions on post-sale and pre-sale freight.

Analysis: Rule 6(4)(f) permits deduction only of amounts actually incurred under the head "freight" when separately specified and charged without including them in the price of the goods sold. The decisive test is not mere separate billing, but the real character of the freight. If the expenditure is incidental to the dealer's acquisition of the goods or is incurred before sale to make the goods available for sale, it forms part of the dealer's cost and becomes a component of the sale price. Deduction is available only where the freight is incurred after sale for and on behalf of the purchaser, in accordance with the principles stated in the controlling Supreme Court decisions.

Conclusion: The exemption is not available to a dealer in all circumstances. Its availability depends on whether the freight is post-sale expenditure incurred for and on behalf of the purchaser, and the question must be determined on the facts of each case.

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