F C I Vs. MAHESHWARI FLOUR MILLS

JUDGEMENT

(1.) The appellant sells-wheat to purchasers in the State of Andhra Pradesh. One of the terms and conditions of the sale is that the price for the wheat is exclusive of all local taxes and that these would be borne and paid by the purchaser. Section 5 of the Andhra Pradesh General Sales Tax Act 1957 imposes basic tax at the rate of one percent; Section 5-A (c) imposes additional tax on turn over at the rate of 1.50 per cent and Section 6b (1) imposes a surcharge at the rate of 10 per cent on the aggregate of the basic and turn over taxes. In other words, on the sale price of Rs. 100 the appellant is required to pay Rupee one by way of basic tax, Rs. 1.50 by way of additional tax and 0. 25 paise as and by way of surcharge aggregating to Rs. 2.75. There is no difficulty insofar as the above is concerned.

(2.) Now, as we understand from counsel the appellants' case, the said Act has no provision that empowers the appellant to pass on the aforesaid tax to its purchasers. It, therefore, collects Rs. 102.75 from the purchaser upon the sale of Rs. 100 worth of wheat. Consequently, it pays tax (basic, additional and surcharge) on the sale price of Rs. 102.75. It has therefore, to pay 10 paise for every Rs. 100 more than it has collected from its purchaser by way of tax. Its contention is that it is entitled to pass on even that 0. 10 paise to its purchaser.

(3.) Some of the appellants' purchasers, namely, the respondents to this appeal, filed a writ petition in the High Court of Andhra Pradesh and sought a refund of the extra amount collected as aforesaid. By the principal order under challenge the writ petition was allowed. A review petition was filed based upon an earlier judgment of that High Court. The review petition was dismissed; the order on the review petition is also under challenge.