- (1.) The appellant is a dealer under the provisions of the Bihar Sales Tax Act. It runs a canteen and a library for the benefit of the officers and employees of Tata iron and Steel Company Limited (hereinafter referred to as "tisco"). It appears that the appellant had agreed to sell food items to the officers and employees of tisco in a canteen which was run by it. The prices of the food items so sold were fixed by the managing committee from time to time in consultation with the canteen, hotel and restaurant workers union, Jamshedpur. It is an admitted fact that the prices so fixed were below the cost price which resulted in a deficit.
(2.) The difference between the income earned and the expenditure incurred by the dealer used to be made good every month by TISCO. The sales tax authorities treated this subsidy given to the dealer as a part of the sale price and added it to the turnover and levied sales tax. Having been unsuccessful before the sales tax authorities and the High Court, this appeal by special leave has been filed.
(3.) It appears to us that the stand of the respondents is not warranted by law. Sales tax is chargeable on the sale of goods by a dealer. The charge is on the gross turnover and according to section 2 (j) of the Bihar Finance Act, 1981 "gross turnover' means for the purpose of levy of sales tax in respect of sale of goods the aggregate amount of sale price which is received and receivable by a dealer. 'sale price' is defined under section 2 (u) to mean the amount payable to a dealer as valuable consideration in respect of the sale or supply of goods.;