Turnover excludes entrusted copper supplied for conversion into cables, since the arrangement was processing work, not a sale.

Under the Andhra Pradesh General Sales Tax Act, 1957, turnover includes only the amount billed as sale consideration, or where no bill exists, the amount charged as consideration for sale. Copper supplied on a zero-value basis for conversion into cables was held not to be part of the sale price, because the agreement showed the material was entrusted for processing and the assessee was paid for the work undertaken. A clause permitting use of the cables for supplies to other departments did not convert the arrangement into a sale, and later use of the cables for loan purposes did not establish ownership in the copper. The copper cost was therefore excluded from turnover and not liable to sales tax on that basis.

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Issues: Whether the cost of copper supplied by the Posts and Telegraphs Department formed part of the assessee's turnover exigible to sales tax under the Andhra Pradesh General Sales Tax Act, 1957 and the Central Sales Tax Act, 1956.

Analysis: Under section 2(s) of the Andhra Pradesh General Sales Tax Act, 1957, turnover comprises the amount set out in the bill of sale or, where there is no bill of sale, the amount charged as consideration for the sale. The copper was supplied on a zero-value basis under the arrangement, and the assessee was obliged to convert it into cables and account for the finished product. The agreement showed that the copper was not sold to the assessee as part of the price of the cables, but was entrusted for conversion, with profit being payable for the work undertaken. Clause relating to use of the copper for supplies to other departments did not alter the legal character of the transaction into one of sale, and the assessee's use of the cables for raising loans did not establish ownership where property in the copper had not passed.

Conclusion: The cost of the copper did not form part of the assessee's turnover and was not liable to sales tax on that basis.

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