TaxTMI 
TaxTMI 
1992 (12) TMI 9
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....s for the financial year 1992-93 obtained by them in an auction held for the purpose in accordance with the provisions of the Punjab Excise Act, 1914, as applicable to the States of Punjab and Haryana. These licences are for retail vend of country spirit including rum and gin and, on the strength of such a licence, licensee trades in the licensed premises in alcoholic liquor for human consumption (other than Indian-made foreign liquor). A licensee who is a successful bidder is required to pay the entire amount of licence fee in twelve monthly instalments, Every licensed premises popularly known as the vend has a fixed quota of country liquor/alcohol and the licensees keep lifting for sale from time to time the country liquor from the distil....
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....unt of the buyer or at the time of receipt of such amount from the said buyer in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, collect from the buyer of any goods of the nature specified in column (2) of the Table below, a sum equal to the percentage specified in the corresponding entry in column (3) of the said Table, of such amount as income-tax : TABLE -------------------------------------------------------------------------------------------------------------------------------------------------- S. No. Nature of goods Percentage (1) (2) (3) ------------------------------------------------------------------------------------------------------------------------------------------------....
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....he Central Government, a State Government or any local authority or corporation or authority established by or under a Central, State or Provincial Act, or any company or firm or co-operative society." It is not disputed that the petitioners who, as licensees, obtain in sale alcoholic liquor for human consumption other than Indian-made foreign liquor fall within the term "buyer" and the distilleries from whom alcoholic liquor is purchased are "sellers" as defined in the Explanation referred to above. The case of the petitioners is that, while collecting tax from them at source, the distilleries-respondents cannot collect tax on the amount of excise duty which they deposit in the Government treasury before obtaining a permit and on the....
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....uyer to the seller (manufacturer) at the time of debiting of the amount or at the time of receipt of such amount by the seller, whichever is earlier, is to be collected by the seller as tax at source. The question is what is the amount payable by the buyer to the seller at the time of debiting of the amount by the seller or at the time of receipt of such amount by him. It cannot be disputed that the amount payable by the buyer to the seller can be debited to the account of the former or is received by the latter only at the time the alcoholic liquor is purchased by the buyer on presentation of the distillery permit obtained by the buyer from the Excise Department. This permit can be had by the buyer after he has paid the excise duty into th....
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....ubt that the quantum of the amount on which the tax is to be collected at source by the seller has to be only that amount which is to be paid to the seller as price at the time of the sale and cannot, by any stretch of reasoning, be held to include the excise duty which has already been paid to obtain the permit to enable the licensee to purchase the liquor. In the case of McDowell and Co. Ltd. [1985] 154 ITR 148 (SC) relied upon by Mr. Tewatia, their Lordships of the Supreme Court were considering a question as to whether excise duty formed part of "turnover" as defined in section 2(1)(s) of the Andhra Pradesh General Sales Tax Act, 1957, and whether sales tax was payable thereon or not. After examining the concept of excise duty, their....