TaxTMI 
TaxTMI 
2011 (8) TMI 1037
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....nd is engaged in the manufacture and sale of cement including ready mix concrete. The assessee had effected sale of ready mix concrete (RMC) to its customers and had filed its returns as per the provisions of the Act and had claimed exemption on the charges collected by it for pumping ready mix concrete at the customers' site. The assessing authority, Deputy Commissioner of Commercial Taxes, issued a notice under section 39 of the Act proposing to levy tax on the turnover relating to pumping charges of RMC. The authority further proposed to levy penalty and interest under the Act for the alleged shortpayment of tax in respect of the same. The assessee filed a detailed reply and also documentary evidence and contended that the turnover relating to pumping charges was a post-sale expenses and therefore, the same was not liable to sales tax and consequently, requested the authority to drop the proposal made in the notice. The assessing authority after considering the contention of the assessee and looking into the documents produced by them held that until and unless RMC is taken to the point where it is put to use at the site of the buyer, the property in goods will not be passed....
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....the assessee has preferred these revision petitions. 3. The learned counsel for the petitioner assailing the impugned order contends that it is not obligatory on the part of the assessee to pump the RMC so as to deliver the goods to the customers. An option is given to the customer to have the services of pumping the RMC or not to utilise the services of pumping provided by the assessee. The price fixed for pumping is an expenditure of costs of RMC to be supplied to the customers' site. From the invoice raised, this fact is clear and therefore, the service charges collected from the customers for pumping the RMC from the vehicle to the site cannot be construed as pre-sale expenses and cannot be included in the sale price. In support of his contention, he relies on the judgment of the apex court as well as the judgment of this court and contends in the facts of this case, the service charges collected by the assessee for pumping RMC cannot be included in the sale price. Therefore, the impugned order is liable to be set aside. 4. Per contra, the learned Government Advocate appearing for the respondent contends that all the charges incurred till the delivery of RMC to the custom....
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....door of the buyer. True, the petitioner had transported the goods to the place of wholesale buyer in the vehicle belonging to the revision petitioner. But this does not mean that the goods were delivered by the seller at the place of the buyer, because in this case, as we have already stated the revision petitioner had also undertaken and collected the freight charges from the buyer to deliver the goods at the place of the buyer and thus in his capacity as a carrier of the goods, he had undertaken to transport the goods to the place of the buyer and not in his capacity as a seller of the goods. The Tribunal as well as the assessing and the appellate authority having forgotten about dual role of the revision petitioner, one as that of a seller of the goods and the other as that of a carrier of the goods having collected the freight charges separately from the buyer, have fallen into a serious error in including the freight charges to the sales turnover of the assessee, which is patently incorrect in view of the nature of the contract entered into between the parties and in view of the fact that the petitioner had collected the freight charges separately. . . . . . the real test to ....
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....ines "Turnover" as under: "'Turnover' means the aggregate amount for which goods are sold or distributed or delivered or otherwise disposed of in any of the ways referred to in clause (29) by a dealer, either directly or through another, on his own account or on account of others, whether for cash or for deferred payment or other valuable consideration, and includes the aggregate amount for which goods are purchased from a person not registered under the Act and the value of goods transferred or despatched outside the State otherwise than by way of sale, and subject to such conditions and restrictions as may be prescribed the amount for which goods are sold shall include any sums charged for anything done by the dealer in respect of the goods sold at the time of or before the delivery thereof." 10. Therefore from the aforesaid definition, it is clear that section 4 of the Act which deals with the liability to tax and rates thereof prescribes that every dealer who is or is required to be registered as specified in sections 22 and 24, shall be liable to pay tax, on his taxable turnover. Therefore, for imposing tax it is necessary to find out what is the turnover. As is clea....
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....r. All expenses incurred till the delivery constitutes sale price. In order to deliver the RMC at the specified place, if the assessee uses the pump, then the charges collected by the assessee from the customer as pumping charges form part of the sale price. If the RMC is not delivered through pumping, then the charges is not collected from the customer and it will not form part of the sale price. Therefore, the sale transaction of the RMC gets completed only when it is delivered at the point where it is finally put to use. All expenses incurred till such stage, if such delivery includes the service of pumping then the pumping charges are also included in the pre-sale expenses and hence, form part of the taxable turnover. 13. In a contract of this nature, there is no dual role played by the assessee. He is not pumping the RMC for and on behalf of the customer. He has to pump the RMC to the specified place as shown by the customer in order to deliver the RMC. Therefore, even if the pumping charges are collected separately as is clear from the invoice produced before us, or as per terms of the contract, still the said pumping charges invariably form part of the sale transaction whic....