Proof of actual tax collection is required before turnover deduction can be claimed under Karnataka sales tax rules.

Deduction of tax from taxable turnover under rule 6(4)(h) of the Karnataka Sales Tax Rules was not available merely on assertion; the assessee had to prove that tax had actually been collected on the relevant sales bills. The earlier Tribunal view was displaced by the later Supreme Court ruling that discharge of this burden is a fact-specific inquiry depending on the evidence in each case. Rule 6 was treated as an enabling provision for arriving at turnover, not as a substitute for proof of actual collection. Because the bills and other material had not been properly examined, the matter was remitted for fresh consideration on the existing and any further documentary evidence.

---

---

Issues: Whether deduction of tax from taxable turnover under rule 6(4)(h) of the Karnataka Sales Tax Rules, 1957 could be allowed without proof that tax had in fact been collected on the relevant sales bills.

Analysis: The deduction claim turned on whether the assessee had discharged the burden of proving actual collection of tax from customers. The earlier view relied on by the Tribunal was held not to be good law in light of the later Supreme Court ruling, which treated discharge of burden as a question of fact depending on the evidence in each case. Rule 6 was treated as only an enabling provision for arriving at turnover and not as dispensing with proof by the assessee. Since the assessing authority had not examined the bills and other material to determine whether tax had actually been collected, the matter required factual re-examination on the existing and any further documentary evidence.

Conclusion: The assessee was required to establish actual collection of tax before claiming the deduction, and the matter was remitted to the assessing officer for fresh consideration on merits.

---