AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
1963 (11) TMI 59
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....f 1963 is filed by the State and S.T.R.P. 21 of 1963 is filed by the assessee. We shall first take up S.T.R.P. 19 of 1963. The controversy in this petition is as to whether the assessee is entitled to deduct from its turnover the excise duty paid by it on the papers sold by it during the assessment year. The Tribunal below has come to the conclusion that the assessee is entitled to deduct the excise duty paid by it from its turnover. The State is challenging the correctness of this conclusion. Liability to pay tax under the Central Sales Tax Act is imposed under section 6. Section 8 of that Act deals with the rates of tax on sales in the course of inter-State trade. Section 9 of that Act provides for levy and collection of tax imposed un....
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....he amount payable to a dealer as consideration for the sale of any goods, less any sum allowed as cash discount according to the practice normally prevailing in the trade, but inclusive of any sum charged for anything done by the dealer in respect of the goods at the time of or before the delivery thereof other than the cost of freight or delivery or the cost of installation in cases where such cost is separately charged." From these provisions it is clear that in determining "turnover" the excise duty paid cannot be deducted. Rule 11 of the Rules framed under the Central Sales Tax Act, 1956, provides for the determination of the turnover. That rule reads: "'11. (1) The period of turnover in relation to any dealer liable to pay....
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....re the prescribed authority." Unlike rule 6 of the Turnover and Assessment Rules framed under the Act, rule 11 framed under the Central Sales Tax Act does not provide for the deduction of the excise duty paid. [See rule 6(5) (j) of the rules framed under the Act]. Prima facie, the definition of the word "turnover" noticed above includes the entire "sale price " as defined in the Central Sales Tax Act. That definition does not provide for any deduction of the excise duty paid. Nor even the rules relating to the determination of the "turnover" provide for such deduction. That being so, the assessee is liable to pay sales tax on his entire turnover as determinable under the Central Sales Tax Act. Sri Nanjundaswamy, the learned counsel for t....
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....viable either under section 8(1) or under section 8(2) on the "turnover" as defined in the Central Sales Tax Act and not as defined in the Madras General Sales Tax Act. Therefore, by the terms of section 8, the assessee was not entitled to have the excise duty paid in respect of goods sold excluded from the "turnover". Dealing with that aspect of the case, this is what Srinivasan, J., who spoke for the Bench, observed: "Giving careful consideration to this argument, it seems to us that it cannot be accepted. Firstly, the tax that is leviable either under section 8(1) or 8(2) of the Act is on the turnover and in so far as the expression 'turnover' occurring in these provisions is concerned, it is the turnover under the Central Sales Tax A....
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....ne can be derived from the other." (See page 381). The above view of the Madras High Court was accepted and adopted by the Kerala High Court in Parvathi Mills (Private) Ltd. v. State of Kerala[1962] 13 S.T.C. 927. We are in respectful agreement with the view taken by the Madras and the Kerala High Courts. No decision taking a contrary view was brought to our notice. The Tribunal below in arriving at the conclusion that the assessee was entitled to the deduction claimed has purported to rely on the decision of this Court in Mysore Silk House v. State of Mysore[1962] 13 S.T.C. 597; 1962 Mys. L.J. 570. Therein this Court was considering the scope of section 8(2) of the Central Sales Tax Act. In that case, this Court laid down that under ....