1987 (2) TMI 502

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....1957). Before the taxing authorities the company asserted to have sold U.B. Export Lager at Rs. 43.18 and Sun Lager at Rs. 43.75 per dozen of bottles and crates. The company asserted when beer was sold, bottles and crates were not sold to their customers. Ownership in the bottles and crates remained with them. Further the agents kept security of Rs. 4.80 per dozen bottles and Rs. 5 for crates. These deposits were returned to customers when bottles and crates were returned. This methodology of vending, the company represented, to be their scheme of sales and offered two circulars of the company to explain the scheme. The two circulars recite for the two brands of beer are to be booked and cheques are to be issued in the name of Phipson....

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....here is no truth in the scheme propounded by the company. We are in agreement with the conclusions reached by the three tax authorities having considered numerous aspects of the scheme. We hold ownership in bottles and crates did not remain with the company when beer was vended. The customer purchased bottles and crates with the contents of receptacles. When bottles and crates are returned (to the extent shown by the company) in law there was a resale of bottles and crates in favour of the company. We have no hesitation to reject the contentions raised by the company. The company, however, cited large number of cases. Among the cases, in Punjab Distilling Industries Ltd. v. Commissioner of Income-tax [1959] 35 ITR 519 (SC) a like cont....