Freight and insurance charges included in taxable turnover where they formed part of the sale consideration for delivery at destination.

Freight and insurance charges incurred to deliver goods at the buyer's premises were treated as part of the sale consideration and therefore includible in taxable turnover under Tamil Nadu sales tax law. Although separate billing may be relevant, it does not alter character where the contract shows the amounts were incurred to complete the sale and title passed only on delivery at the contractual destination. Rule 6(c) on deduction of separately specified freight applies only when freight is not part of the price read with the statutory turnover provisions. On that reasoning, the assessee's contention failed and the charges remained taxable.

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Issues: Whether freight and insurance charges incurred under the contract formed part of the sale price and taxable turnover under the Tamil Nadu sales tax law.

Analysis: The contract required delivery at the buyer's premises and title passed only on such delivery. In that setting, the seller's expenditure on freight and insurance was incurred to complete the sale and make the goods available at the place of delivery. Rule 6(c) permitting deduction of freight applies only where freight is specified and charged separately without forming part of the price, but that rule must be read with the statutory definitions of turnover and sale. Where the contractual arrangement shows that the amount is part of the consideration for sale, separate billing does not change its character. The established principle is that amounts paid by the buyer as part of the consideration for obtaining delivery at the contractual destination are includible in turnover.

Conclusion: Freight and insurance charges formed part of the sale price and were includible in taxable turnover; the assessee's contention failed.

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