Freight charges and turnover exclusion require proof of transit sale or commission agency; unsupported factual findings were left undisturbed.
Exclusion of freight charges from turnover depends on proof that the freight was not part of sale consideration and that the coal supplies were sold in transit by endorsement of railway documents, or alternatively that the assessee acted only as a commission agent. The Tribunal found no documentary or other reliable evidence supporting either basis, and those concurrent factual findings disclosed no legal error. On that footing, revisional interference was not warranted and the turnover addition relating to freight charges was sustained.
Issues: Whether freight charges paid in respect of coal supplies were includible in the assessee's turnover, and whether the assessee had established that the transactions were either sales in transit by endorsement or transactions undertaken as a commission agent.
Analysis: The exclusion of freight from turnover depended on proof that the freight was not part of the assessee's sale consideration and that the sale had been effected in transit by endorsement of the railway documents, or alternatively that the assessee had acted only as a commission agent. The Tribunal recorded concurrent factual findings that no documentary or other reliable evidence established either plea. Those findings were based on the material on record and did not disclose any legal error warranting revisional interference.
Conclusion: The assessee failed to prove that the freight charges were outside its turnover or that the transactions were sales in transit or commission agency transactions; the Tribunal's findings were upheld.
Final Conclusion: The revision was devoid of merit and the turnover addition relating to freight charges was sustained.
Ratio Decidendi: Where exclusion of freight from turnover is claimed, the assessee must establish the factual basis for the exclusion, and findings of fact supported by evidence are not to be disturbed in revision absent legal error.
TaxTMI 
AI Drafter ✕
TaxTMI 
