Post-delivery transport and allied charges excluded from purchase turnover when sale is complete on ex-site delivery.

Where fly ash is delivered ex-site at the thermal power station and the purchaser bears removal at its own cost and risk, the sale is complete on delivery and payment of the agreed price. Loading, transport, unloading and related expenses incurred only after delivery are not part of the seller's consideration and are not pre-sale expenditure. Those post-delivery charges therefore cannot be added to purchase turnover under the Tamil Nadu General Sales Tax Act, and the levy on that component is unsustainable. The assessment could not be enlarged by including the purchaser's subsequent transport and allied processing costs.

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Issues: Whether loading, transport, unloading and related charges incurred by the purchaser after delivery of fly ash at the thermal power station formed part of the purchase turnover liable to tax under section 7A of the Tamil Nadu General Sales Tax Act, 1959.

Analysis: The delivery of fly ash was found to have taken place at the site of the thermal power station itself, and the purchaser was required to remove it at its own cost and risk. On those facts, the sale was complete when the goods were delivered ex-site and the agreed purchase price was paid. The subsequent expenses incurred by the purchaser for drying, clearing and transporting the fly ash to its factory were not part of the consideration payable to the seller and were not expenses incurred by the seller at or before delivery. Such amounts therefore could not be treated as pre-sale expenditure or included in the taxable purchase turnover under section 7A. The conclusion was supported by prior decisions holding that post-delivery transport and extraction charges do not form part of purchase turnover.

Conclusion: The disputed charges were not includible in the purchase turnover and the levy on that component was unsustainable; the issue was decided in favour of the assessee.

Final Conclusion: The revision failed, and the assessment could not be enlarged by adding the post-delivery transport and allied charges to the purchase turnover.

Ratio Decidendi: Where goods are sold ex-site and delivery is complete at the seller's premises, expenditure incurred by the purchaser after delivery for removal, transport or allied processing is post-sale expenditure and does not form part of purchase turnover under section 7A.

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