TaxTMI 
TaxTMI 
1965 (12) TMI 92
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.... facts and circumstances of the case, the Tribunal is right in holding that the Central sales tax paid by the opposite party at its purchase point and charged on to its customers does not form a part of the sale price of the commodity sold so as to be taxable under the Orissa Sales Tax Act, 1947. 2.. Whether, in the facts and circumstances, the allowance of the claim of the opposite party for deduction of Central sales tax collected from its customers is permissible under the provisions of the Orissa Sales Tax Act and the Rules framed thereunder." Before we examine the facts and circumstances of the case, it is convenient to set out the relevant provisions of the Orissa Sales Tax Act, 1947 (hereinafter called the Act) as it stood prio....
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....nt facts. For the quarter ending September 30, 1957, the respondent, M/s. Utkal Distributors (P.) Ltd., hereinafter referred to as the assessee, claimed to deduct from its gross turnover the sum of Rs. 3,874.49 on the ground that it had paid this sum on the purchases made by it as Central sales tax. The Sales Tax Officer disallowed the claim. On appeal, the Collector of Sales Tax, Orissa, affirmed the order of the Sales Tax Officer. The Sales Tax Tribunal, Orissa, in second appeal, however, came to the conclusion that there was no justification to disallow the deduction claimed by the appellant. The Tribunal held that the Central sales tax realised by the assessee from its customers was not part of the price charged by it, and, therefore....
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....to them could not be treated as sale price of goods and could not be included in the taxable turnover. The Com- missioner of Sales Tax being dissatisfied with the order of the Tribunal sought a reference to the High Court and the Tribunal referred the case under section 24(1) of the Act, formulating two questions which have already been set out. The High Court answered the questions in the affirmative. Before the High Court the counsel for the State urged that the expression "tax" occurring in the definition of "turnover " in section 2(i) and in the definition of "taxable turnover" in section 5(2)(b) referred only to the sales tax paid under the Orissa Sales Tax Act, and not to the tax paid under the Central Sales Tax Act, and that this ....
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....ct it and pay it to the Government, what he is permitted to so collect under the law would continue to retain its character as tax and it would never form part of the purchase price." The High Court further observed that "the Union Government themselves fixed the price of iron material sold by him to his customers. He was not entitled to charge anything higher. In addition to that price he was permitted to charge Central sales tax which he was subsequently required to credit to Government. Section 9-A of the Orissa Sales Tax Act says that any amount collected by a registered dealer as sales tax from his purchasers shall be deposited by him in the Government Treasury. It is true that by its own force this section would apply only to Oriss....
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....urt, it is not necessary to deal with question No. 2. It is not necessary to decide whether the word "tax" in sec- tion 2(i) and section 5(2)(b) of the Orissa Sales Tax Act means the tax levied under the Orissa Sales Tax Act and not the tax levied under the Central Sales Tax Act. We will, however, assume for the purpose of this case that the expression "tax" in section 2(i) and section 5(2)(b) of the Act does not include Central sales tax. We have set out condition No. 4(ii) of the Iron and Steel (Control) Notification above. It seems to us that it is clear from this condition, and the fact that the controlled stock-holder was not entitled to charge a price higher than that fixed by the Government of India, that the valuable considera....