G.SANKARAN Vs. DEPUTY COMMERCIAL TAX OFFICER

JUDGEMENT

(1.) These writ petitions have been filed by the Assessee aggrieved by the order dated 7th February 2002 passed by the Tamil Nadu Taxation Special Tribunal, Chennai - 600 001, dismissing the Tax Appeals filed by the Assessee and holding that the freight charges paid by the Assessee for delivery of Gypsum sold by it to the customer viz. , M/s. Tamil Nadu Cements Corporation Limited at Ariyalur was part of the taxable turnover as defined in Section 2(p) of the Tamil Nadu General Sales Tax Act, 1959 (in short 'TNGST Act').

(2.) The relevant observations of the learned Tribunal in the impugned order are quoted below for ready reference.

(3.) The learned counsel for the Assessee Mr. N. Inbarajan submitted before us that Rule 6(c) of the TNGST Rules provides for a deduction of freight and charges for delivery from the taxable turnover as defined in Section 2(p) of the Act and since there was a separate bargain for the price of the goods viz. , Gypsum sold by the petitioner/Assessee to the customer and freight charges as indicated in the Purchase Order itself, therefore, the Assessing Authority as well as the learned Tribunal have erred in holding the said delivery charges and freight charges are part of the turnover and imposing tax on the same under the provisions of the TNGST Act. He submitted that even though the contract of sale was "F. O. R. Destination" at the business place of the customer viz. , Tamil Nadu Cements Corporation Ltd. , Ariyalur, but since there was a separate bargain for the freight charges which was fixed between the parties at Rs. 120 per Metric Tonne, besides the price of the Gypsum sold by the petitioner/Assessee at Rs. 137. 15 per Tonne of the Gypsum and also Rs. 9. 80 for unloading and stacking charges at Ariyalur Factory Site of the customer, therefore, such freight charges or delivery charges could not be treated as part of the taxable turnover of the Assessee seller.