Sales tax computation rules cannot override the charging section; deduction provisions remain valid machinery for taxable turnover.

Rule 6(4)(m)(i) of the Karnataka Sales Tax Rules, 1957 was examined as a computation provision under section 5-B of the Karnataka Sales Tax Act, 1957. The rule was treated as part of the machinery for determining taxable turnover by permitting specified deductions from total turnover, not as a source of charge or an enlargement of statutory liability. Even if an assessing authority applied the rule incorrectly and brought exempt turnover into tax, that misapplication would not render the rule itself invalid. The provision was therefore held not to be ultra vires section 5-B, and the challenge to its validity failed.

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Issues: Whether rule 6(4)(m)(i) of the Karnataka Sales Tax Rules, 1957 was ultra vires section 5-B of the Karnataka Sales Tax Act, 1957 on the ground that it brought exempt turnover into the taxable base while computing liability under section 5-B.

Analysis: Liability to tax arose under section 5-B of the Karnataka Sales Tax Act, 1957, while rule 6(4)(m)(i) formed part of the machinery for determining taxable turnover by allowing deduction of specified amounts from total turnover. The provision did not itself create a charge or expand the statutory liability, but only operated as an exclusionary clause for computing the turnover liable to tax. Even if an assessing authority misapplied the rule so as to tax amounts beyond what the statute permitted, such application would not make the rule itself void or ultra vires, because the rule could not override the charging section or be treated as the source of the liability.

Conclusion: Rule 6(4)(m)(i) was not ultra vires section 5-B and the challenge to its validity failed.

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