Rubber cess treated as excise duty forms part of purchase turnover and is liable to sales tax.

Rubber cess under Section 12 of the Rubber Act, 1947 is treated as a duty of excise attaching to the production of rubber, and the 1960 amendment shifting collection to the manufacturer did not change that character. Because turnover under the Kerala General Sales Tax Act, 1963 covers the aggregate consideration for goods, the excise burden formed part of the purchase price of rubber. The cess paid by manufacturers of rubber products was therefore includible in purchase turnover and liable to sales tax.

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Issues: Whether rubber cess paid by manufacturers of rubber products formed part of their purchase turnover of rubber for assessment under the Kerala General Sales Tax Act, 1963.

Analysis: Rubber cess under Section 12 of the Rubber Act, 1947 is a duty of excise on the production of rubber, and the taxable event is production of rubber in India. The 1960 amendment allowing collection from the manufacturer was treated as a measure to facilitate recovery and not as altering the essential character of the levy. A duty which attaches at the stage of production remains part of the price paid for the goods, even if collection is deferred or made from the manufacturer for convenience. The definition of turnover under the sales tax law covers the aggregate amount payable as consideration for the goods, and the mode in which that consideration is made up does not exclude an excise burden that is part of the purchase price.

Conclusion: The rubber cess paid by the assessees is includible in their purchase turnover and is exigible to sales tax.

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