Freight and carriage inward form taxable turnover when incurred before purchase or delivery is complete.

Carriage inward and freight inward incurred before completion of purchase formed part of purchase turnover under the Kerala General Sales Tax Act because "turnover" covers the aggregate amount paid for the goods, including incidental expenditure needed to bring them to the dealer's place of business. Rule 8(2) was read subject to that statutory definition, and the freight exclusion in rule 9(f)(i) was confined to sales turnover, not purchase turnover. Under the Central Sales Tax Act, sale price includes expenditure incurred until delivery, and the assessee failed to show that the freight was borne after completion of sale. The charges were therefore includible and not deductible.

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Issues: Whether carriage inward and freight inward incurred by the purchasing dealer form part of the purchase turnover under the Kerala General Sales Tax Act and the sale price under the Central Sales Tax Act.

Analysis: The expression "turnover" under section 2(xxvii) of the Kerala General Sales Tax Act, 1963 was held to mean the aggregate amount for which goods are bought or sold. Rule 8(2) was treated as subject to that statutory definition, so that the amount for which the goods are bought includes the price paid as well as incidental expenditure incurred to bring the goods to the dealer's place of business. The exclusion of freight under rule 9(f)(i) was found to operate in the context of sales turnover and not purchase turnover. On the facts, the transportation and handling charges were incurred before the purchase was complete and were part of the cost of acquisition. Under section 2(h) of the Central Sales Tax Act, the sale price also includes expenditure incurred until delivery to the buyer, and the assessee did not establish that freight was borne on behalf of the buyer after completion of sale.

Conclusion: Carriage inward and freight inward were correctly included in purchase turnover under the Kerala General Sales Tax Act and were not deductible from sale price under the Central Sales Tax Act.

Ratio Decidendi: Where freight or carriage expenses are incurred before the purchase or sale is complete and are necessary to make the goods available at the dealer's place of business or to complete delivery, they form part of the taxable turnover or sale price and are not deductible as post-sale charges.

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