Sale price includes reimbursed designing and tooling charges when they are integral to manufacture and delivery of goods.

Designing charges and tooling cost reimbursed by customers were treated as part of the sale price under Section 2(29) of the Bombay Sales Tax Act, 1959. The definition of sale price was applied to cover valuable consideration for the sale, including sums charged for work done by the dealer in relation to the goods before delivery. Because the moulds and designs were prepared by the seller for manufacture, remained with the seller, and were necessary for delivery of the seating systems, the reimbursement had an inescapable connection with the supply. It was therefore not a separate post-sale amount but part of the consideration for the sale.

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Issues: Whether designing charges and tooling cost reimbursed by customers form part of the sale price under Section 2(29) of the Bombay Sales Tax Act, 1959.

Analysis: The definition of sale price covers the amount of valuable consideration paid or payable for a sale, including sums charged for anything done by the dealer in respect of the goods at or before delivery. On the facts, the moulds and designs were prepared by the seller for manufacture of the goods, remained with the seller, and were necessary for delivery of the seating systems. The charges for designing and tooling were part of the same contractual transaction and had an inescapable connection with the supply of the goods. The Court distinguished cases where tooling or moulds were supplied free by the buyer and held that, in the present case, the reimbursement was not a separate post-sale amount but part of the consideration for the sale.

Conclusion: The designing charges and tooling cost reimbursed by the customers form part of the sale price and are includible under Section 2(29) of the Bombay Sales Tax Act, 1959.

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