Ranganathan, J. - (1.) By its judgment dated 23-12-1981, reported as Ramco Cement Distribution Co. (P) Ltd. v. State of Tamil Nadu, (1982) 51 STC 171, the Madras High Court disposed of a batch of 48 sales tax revision cases arising out of the assessments, to local Sales Tax (T.N. S.T.) as well as Central Sales Tax (C.S.T.), of Ramco Cement Distribution Co. (P) Ltd. (16 cases), Madras Cements Ltd. (8 cases), Dalmia Cement Bharat Ltd. (21 cases) and India Cements Ltd. (3 cases). The questions at issue were answered partly in favour of Revenue and partly in favour of the assessees. C. A. Nos. 5306-5336/ 1985 -preferred by the State of Tamil Nadu arise out of 31 of these cases:9 relating to Ramco Cements, 16 relating to Dalmia Cements and 6 relating to Madras Cements. C.A. No. 2684 to 2690/82 are appeals by Ramco Cements and C.A.No. 4043-4044/ 1982 are by Madras Cements from the same judgment. C.A. Nos. 315-319/ 1983 arise out of the other 5 cases relating to Dalmia Cements. C.A. Nos. 280-281/ 1989 arise out of a judgment of the High Court dated 17-1-1985 which dismissed two revision tax cases pertaining to Dalmia Cements. One of the questions involved in these cases was decided in favour of the assessee by following the decision in 51 STC 171. As the questions involved are common, all these appeals are being disposed of by a common judgment. In doing so, we shall refer to the facts in the appeals pertaining to Ramco Cements. It is common ground that the facts in other cases are similar and that the decision reached in the case of Ramco Cements will govern the other appeals as well.
(2.) Ramco Cement Distribution Co. Pvt. Ltd. (hereinafter referred to as 'the assessee) are the selling agents of M/s. Madras Cements Ltd., Rajapalayam. For the assessment year 1969-70, they were assessed to sales tax on a taxable turnover of Rs. 2,37,66,245/ which included an amount of Rs. 29,71,527/- representing freight charges. The assessee claimed exclusion of freight charges in computing the taxable turnover on the ground that freight had been independently charged in the invoices. It relied on the decision of the Supreme Court in the case of Hyderabad Asbestos Cement Products Ltd. v. State of Andhra Pradesh, (1969) 24 STC 487. This contention was rejected by the assessing authority, the appellate authority as well as the Tribunal. Aggrieved by the above orders, the assessee preferred revisions to the High Court. The questions that arose for the consideration of the High Court were enunciated as follows at the commencement of its judgment: (i) Whether the freight charges incurred by a dealer in the despatch of cement to the place of the customer could be deducted from the total turnover of the dealer under the Central Sales Tax Act, Tamil Nadu General Sales Tax Act and the Tamil Nadu Additional Sales Tax Act; (ii) Whether the packing charges being the cost of the packing materials used by the dealer in packing cement for being delivered to his customers could be properly excluded from his turnover for the assessment of sales tax ; (iii) Whether the excise duty paid on packing materials used by a dealer for packing cement to be sold to his customers can be excluded in his total turnover. These questions were answered by the High Court as follows: "In tax revision cases arising under the Central Sales Tax Act, we hold that the freight, packing charges and excise duty on packing materials have to be included in the sale price for the computation of sales tax. In cases arising under the Tamil Nadu General Sales Tax Act and Tamil Nadu Additional Sales Tax Act, we hold that freight, packing charges and excise duty on packing materials are not liable to be included in the sale price for the computation of the sale price. The assessee are not liable to pay additional sales tax on freight, packing materials and excise duty on packing materials in those cases arising under the Tamil Nadu Additional Sales Tax Act." The High Court certified the case to be one fit for appeal to the Supreme Court and hence these appeals.
(3.) Both the assessees as well as the State Government are aggrieved by the High Court's decision. The State urges that, the High Court having held that the amounts in question were liable to be included in the turnover for purposes of Central, Sales Tax Act, ought to have also held that these amounts were liable to be included in the taxable turnover for purposes of Tamil Nadu General Sales Tax Act and the Tamil Nadu Additional Sales Tax Act. On the other hand, on behalf of the assessees, it is contended that, even for the purposes of C.S.T., the freight charges, the cost of packing materials and the excise duty on the packing materials should have been excluded in the computation of the taxable turnover. It is thus there are cross appeals before us.;