TaxTMI 
TaxTMI 
2016 (8) TMI 1075
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....ble under the Customs Act, 1962 by the Respondent? (II) Whether on the facts and in the circumstances of the case and on a true and correct interpretation of Explanation-I to section 2(22) added with effect from 1/9/1990 when the sub-clause 2 of sub-rule 3 of Rule 41D specifically provides reduction of 3 % of the purchase price of goods covered under section 75, the Tribunal was justified in law in holding that the term 'Purchase Price' is applicable only to the purchases effected within the State and is not applicable to the purchases covered by section 75? 2. The real controversy in the present Reference is whether the customs duty paid by the Respondent herein (M/s Bajaj Tempo Ltd.) on goods imported by it from out of the country, and which are used in the manufacture of their vehicles, should be included in the definition of the words "purchase price" as set out in section 2(22) of the BST Act. 3. The brief facts giving rise to the present controversy are that the Respondent herein (M/s Bajaj Tempo Ltd.) is a manufacturer of motor vehicles, especially three-wheelers and parts thereof. It is duly registered under the provisions of the BST Act as also the Centra....
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.... Since the Revenue was unhappy with this decision, they preferred a Reference Application No.96 of 2006 requesting the MSTT to refer the above referred questions of law for determination of this Court. The MSTT, after hearing the parties, by its order and judgment dated 11th August, 2006 was pleased to refer the questions of law set out in paragraph 1 above, for determination of this Court. It is in these circumstances that the present matter has come up before us. 9. In this factual backdrop, Ms Uma Palsuledesai, learned Assistant Government Pleader, appearing on behalf of the Applicant, contended that "purchase price" has been defined in section 2(22) of the BST Act. It means the amount of valuable consideration paid or payable by a person for any purchase made, including any sum charged for anything done by the seller in respect of the goods at the time of or before delivery thereof. She submitted that Explanation I to the said definition categorically states that the amount of duties levied or leviable on goods inter alia under the Customs Act, 1962 shall be deemed to be a part of the "purchase price" for such goods. Laying heavy stress on this Explanation, the learned Assist....
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....ng done by the seller in respect of the goods at the time of or before delivery thereof, other than the cost of insurance for transit or of installation, when such cost is separately charged. Explanation I to the said definition stipulates that for the purposes of this clause, the amount of duties levied or leviable on goods under the Central Excise and Salt Act, 1944 or the Customs Act, 1962 or the Bombay Prohibition Act, 1949 shall be deemed to be part of the purchase price of such goods, whether such duties are paid or payable by or on behalf of the seller or the purchaser or any other person. Explanation II stipulates that the purchase price shall not include sales tax, turnover tax, surcharge and resale tax paid or payable by a person in respect of any such purchase. 12. Thereafter, the word "sale" has also been defined in section 2(28) which reads as under :- "2. Definitions - In this Act, unless the context otherwise requires, - (28) 'sale' means a sale of goods made within the State for cash or deferred payment or other valuable consideration and includes any supply by a society or club or an association to its members on payment of a price or of fees or subscrip....
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....h sale or purchase takes place - (a) (i) outside the State; or (ii) in the course of the import of the goods into the territory of India; or the export of the goods out of such territory; or (b) in the course of inter-State trade or commerce, and the provisions of this Act and the said rules shall be read and construed accordingly; Explanation - For the purpose of this section whether a sale or purchase takes place - (i) outside the State, or (ii) in the course of the import of the goods into the territory of India or export of the goods out of such territory, or (iii) in the course of inter-State trade or commerce, shall be determined in accordance with the principles specified in sections 3, 4 and 5 of the Central Sales Tax Act 1956." (emphasis supplied) 14. Section 75 clearly stipulates that nothing in the BST Act or the Rules made thereunder shall be deemed to impose or authorise the imposition of tax on any sale or purchase of any goods of which sale or purchase takes place inter alia in the course of import of the goods into the territory of India or the export of the goods outside such territory. Section 75 further provides that the provisions of the BST Act a....