TUNGABHADRA INDUSTRIES LTD Vs. COMMERCIAL TAX OFFICER KURNOOL
LAWS(APH)-1955-2-6
HIGH COURT OF ANDHRA PRADESH
Decided on February 11,1955

TUNGABHADRA INDUSTRIES LTD., KURNOOL Appellant
VERSUS
COMMERCIAL TAX OFFICER, KURNOOL Respondents


Referred Judgements :-

STANLEY V. WESTERN INSURANCE CO. [REFERRED TO]
COTTON V. VOGAN AND CO. [REFERRED TO]
KAPILDEORAM BAIJNATH PROSAD V. J.K.DAS [REFERRED TO]
TOMCO SALES DEPARTMENT KINGSWAY NAGPUR VS. STATE [REFERRED TO]





JUDGEMENT

Chandra Reddy, J. - (1.)THE interpretation of rules 18(2) and 5(1)(g) of the Turnover and Assessment Rules framed by the Government in exercise of the powers conferred by rule 3, sub-rules (4) and (5), of the Madras General Sales Tax Act is involved in this Revision Case. The dispute relates to the assessment year 1949-50. The petitioner is registered as a manufacturer under rule 18. The assessee-company purchases groundnuts and converts them into oil both refined and hydrogenated. A deduction was claimed both under rule 18(2) and rule 5(1)(g). The department declined to grant the deduction under both the heads on the ground that in the first case the oil sold by the petitioner was not the same commodity which was obtained by pressing the kernel and in regard to the second that the freight was not included in the price of the commodity as contemplated in rule 5(1)(g).
(2.)ON appeal, the Sales Tax Tribunal allowed the deduction in respect of refined oil but refused it with regard to the hydrogenated oil and freight charges. The Tribunal held that the hydrogenated oil otherwise called Vanaspathi was not the same thing as the oil obtained from crushing the groundnut and therefore fell outside the cope of rule 18(2). As regards the freight charges it was decided that the benefit under rule 5(1)(g) was not available to the petitioner as it was not shown as something different from the price of the goods sold.
The view of the Tribunal on both the matters is canvassed before us in this Revision Case.

(3.)WE will first deal with the claim for deduction under rule 5(1)(g) of the Turnover and Assessment Rules, as it can be disposed of easily. The contention of Mr. Rajah Ayyar in this behalf is that deduction is allowable in the case of freight charges as they are shown as separate items in the bills. In order to appreciate this argument, it is necessary to refer to the relevant rule :-
"5. (1) The tax or taxes under section 3 or 5 or the notification or notifications under section 6(1) shall be levied on the net turnover of a dealer. In determining the net turnover the amounts specified in clauses (a) to (k) shall, subject to the conditions specified therein, be deducted from the gross turnover of dealer - * * * * (g) all amounts falling under the following two heads, when specified and charged for by the dealer separately, without including them in the price of the goods sold : (i) freight; (ii) charges for packing and delivery and other such like services."

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