1981 (1) TMI 239

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....es tax did not represent the assessee's taxable income under the provisions of the Income-tax Act, 1961?" The assessee is a resident company and the assessment year involved is 1968-69. The relevant accounting period was the financial year which ended on 31st March, 1968. In this accounting period, the assessee had transferred a sum of Rs. 76,103 from the Central sales tax account to an unclaimed deposit account. The amount represented what remained of the sales tax collected by the assessee from its customers during a long period past but not paid to the Government. The Income-tax Officer held that the sales tax collected by the assessee formed part of the trading receipts and as corresponding amounts had been originally allowed on t....

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....s to us that in view of the decision of the Supreme Court in the case of Chowringhee Sales Bureau Pvt. Ltd. v. Commissioner of Income-tax [1973] 31 STC 254 (SC); 87 ITR 542 (SC), this question is well-settled. There, the assessee, a private company dealing in furniture was also acting as auctioneer. In respect of the sales effected by it as auctioneer, the assessee realised during the relevant period, in addition to the commission, Rs. 32,986 as sales tax. This amount was credited separately in its account under the head "sales tax collection account". The assessee did not pay the amount of sales tax to the actual owner of the goods nor did it deposit the amount realised by it as sales tax to the State exchequer because it took the position....

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....d High Court in the case of Commissioner of Income-tax v. Sheo Nath Prasad Hari Kishan [1974] 34 STC 485; 93 ITR 282. There, section 3 of the U.P. Sales Tax Act imposed a tax on every dealer on the turnover of sales during an assessment year. The liability to pay sales tax was therefore on the dealer and there was no liability on the purchaser. Under section 8-A(2)(b) of the U. P. Sales Tax Act, a registered dealer had been given the right to recover from his customers an amount equivalent to the sales tax payable by him but he was not obliged to do so. The liability to pay sales tax was solely of the dealer whether he realised such tax from his customers or not. Therefore, the tax charged by the dealer from his customer was in reality a pa....