Prakash Krishna, J. - (1.) THE above revision has been filed under Section 11(1) of U.P. Trade Tax Act and is directed against the order dated 25.2.2000 whereby and whereunder the Trade Tax Tribunal Bench-III, Agra has allowed the second appeal No. 206 of 1999 relating to the assessment year 1994-95 (U.P.) filed by the dealer opposite party and has held that the charges for maintenance and repairs of gas cylinders termed as "service charge" for filling of Oxygen gas is not part of 'turnover' of 'sale' within the meaning of U.P. Trade Tax Act.
(2.) CHALLENGING the legality and validity of the aforesaid order, the Commissioner of Trade Tax, U.P. has preferred the above revision. In the memo of revision although number of questions of law have been framed, however, Sri B.K. Pandey, the learned Standing Counsel submits that the following question alone will suffice the disposal of the entire controversy: (ii) Whether on the facts and in the circumstances of the case, the Trade Tax Tribunal was legally justified to hold that the charges for maintenance of cylinder for filling of Oxygen gas is not a part of turnover of sale despite the maintenance was pre-delivery work and the charges were pre-delivery expenses." The facts of the case are not much in dispute and may be noted in brief: The dealer opposite party, a limited Company, carries on the business of manufacture and sale of Oxygen gas. For the relevant assessment year i.e. 1994-95 it declared sale of Oxygen gas at Rs. 36, 65, 502.53 and service charges amounting to Rs. 24, 80, 021.84 in the sale turnover by the dealer. The claim of the Company that the service charges amounting to Rs. 24, 80, 021.84 does not form part of taxable turnover was rejected by the Assessing Officer while framing the assessment order. The said order was confirmed in Appeal No. 936 of 1998 by the Deputy Commissioner (Appeals) IV, Trade Tax, Agra. Second Appeal No. 206 of 1999 was preferred by the dealer opposite party before the Tribunal which came up for consideration before a Bench consisting of two Hon'ble Members. There being difference of opinion in between the two Members, the matter was referred for opinion to a third Member who concurred with the opinion of the learned Member holding that the service charges realised from the customers for maintenance and repairs of cylinders will not form part of 'turnover' The sole basis of majority opinion is that the cylinders in which gas is filled are not 'goods' because they have not been sold to the customers, therefore, anything done to the cylinders to make them worthy for filling the gas, and charged as service charges will not fall within the ambit of Section 2(i) of the Act. It is admitted case of the parties that the dealer opposite party supplied the manufactured Oxygen gas to the customers as per their orders by filling the gas in the empty cylinders of various sizes supplied by the customers. The case of the dealer opposite party is that under the relevant statutory provisions known as 'Gas Cylinder Rules, 1981', a manufacturer of Oxygen gas is under legal obligation to clean and test the cylinders before filling it with Oxygen. Valves etc. are required to be cleaned and tested before filling the gas in such cylinders. It is not in dispute that the dealer opposite party has charged certain amount from its customers known as 'service charges' towards the expenses incurred by it in carrying out cleaning etc. of the cylinders before filling the gas therein. It is also not in dispute that the cylinders were supplied by the customers and the dealer opposite party has not charged any amount from the customers towards the supply of the cylinders, as sale consideration. After cleaning and testing the cylinders, the gas was filled in them and cost of Oxygen gas was charged. Also 'service charges' for the cleaning and testing of valves etc. of the cylinders, was charged.
(3.) ACCORDING to majority opinion of the Tribunal, the 'service charges' thus realised by the dealer opposite party from the customers towards the cleaning etc. of the cylinders shall not form part of 'turnover' on the short ground that such charges were not in respect of the 'goods' in question namely the 'gas' but were in respect of the cylinders which were not goods as they were not subject-matter of transaction of sale. The Tribunal has proceeded to answer the controversy taking into consideration the definition of 'goods' as defined in Section 2(b), 'purchase price' as defined in Section 2(gg), 'sale' as defined in Section 2(h) and the 'turnover' as defined in Section 2(i) of U.P. Trade Tax Act. Sri B.K. Pandey, learned Standing Counsel appearing on behalf of the department submits that the definition of turnover as given in Section 2(i) is very widely worded. In the definition of turnover' aggregate amount for which goods are supplied or distributed by way of sale directly or through another person have been included. He submits that unless excluded by any other provision of the Act, any sum charged by the dealer or any act done by it before or at the time of sale shall be included in the 'turnover'. Reliance was placed upon a Division Bench decision of Kerala High Court in South India Carbonic Gas Industries Ltd. v. State of Kerala, (2004) 135 STC 541.;