Purchase price includes delivery-related charges and supply-linked subsidies when paid under the sale contract for taxable turnover.

Amounts paid by the purchaser under the contract of sale, including sums incurred to secure delivery of goods, form part of the sale consideration and are includible in taxable turnover. Applying that principle, transport charges paid to third-party lorry owners for delivery of sugarcane at the factory gate were treated as part of the purchase price, because they secured scheduled delivery and regular supply, and invoice bifurcation did not change the real character of the transaction. The planting subsidy paid to cane growers was likewise linked to supply and formed part of the price for purchase. Both components were therefore subject to purchase tax under the Tamil Nadu General Sales Tax Act.

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Issues: Whether the transport charges paid to third-party lorry owners and the planting subsidy paid by the sugar mill to cane growers were includible in the purchase price of sugarcane for the purpose of purchase tax under the Tamil Nadu General Sales Tax Act, 1959.

Analysis: The dispute was governed by the settled line of authority holding that amounts paid by the purchaser pursuant to the contract of sale, or as expenses necessary to complete delivery of the goods, form part of the consideration and are includible in purchase price. The agreement required delivery of sugarcane at the factory gate, and the transport payments were made to secure scheduled delivery and regular supply of cane. Merely splitting the price in the invoices or paying the transport component directly to lorry owners did not alter the real nature of the transaction. The same principle applied to planting subsidy, which was linked to supply of sugarcane and formed part of the price paid for the purchase.

Conclusion: The transport charges and planting subsidy were correctly treated as part of the purchase price and subjected to purchase tax.

Final Conclusion: The challenge to the assessment failed, and the Tribunal's view sustaining tax on the disputed components was upheld.

Ratio Decidendi: Amounts paid by the purchaser under the contract of sale, including payments made to secure delivery of goods or linked to their supply, are part of the sale consideration and are includible in taxable turnover.

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