COMMISSIONER OF TRADE TAX Vs. SHARMA COAL COMPANY

JUDGEMENT

(1.) These two revisions under Section 11 of U. P. Trade Tax Act (hereinafter referred to as Act) is directed against the order of Tribunal dated 13.4.1994 relating to the assessment years 1985-86 and 1986-87 respectively. The following common question has been raised and argued in the present revisions:

(2.) The dealer opp. party (hereinafter referred to as 'dealer') was carrying on the business of coal and was registered under the U. P. Trade Tax Act as well as under the Central Sales Tax Act. Dealer claimed itself to be a Coal Agent under the Coal Control Order, 1977 (hereinafter referred to as Coal Control Order) and stated that the license in Form-B was issued in this regard. In the assessment years under consideration, dealer had imported coal against its own Form 31 and supplied coal to various parties mainly to the Brick Kiln owner. Freight incurred in bringing coal from coallery to its destination was separately shown in the bill. It is claimed that the amount of freight was paid directly by the purchaser, but this fact had not been accepted, but it was not disputed that in the bill, freight was separately mentioned. It was claimed that freight charges which was incurred for bringing coal from coallery to the destination of the dealer was not liable to be included in the turnover on the ground that the dealer was a Coal Agent and charged 2% commission from its customers apart from the value of coal. Assessing Authority had not accepted the plea of dealer and included the amount of freight incurred in bringing the coal from coallery to its destination in the turnover. In the first appeal, Appellate Authority also up held the view of Assessing Authority treating the freight incurred prior to sale as part of the turnover. Dealer filed appeals before the Tribunal. Tribunal vide impugned orders, allowed the appeals and held that freight would not be part of the turnover.

(3.) Learned Standing Counsel submitted that the Tribunal has erred in holding that the amount of freight incurred for bringing the coal from Coallery to the destination of dealer was not part of the turnover. He submitted that the dealer was registered under the U.P. Trade Tax Act as well as under the Central Sales Tax Act and purchased coal from, Coallery in its own account and imported such coal inside the State of U. P. at its destination against its own Form 31 and sold the coal for price to various parties. He submitted that the manner of preparing bill is wholly irrelevant and in substance, dealer had sold the coal on principal-to-principal basis to various customers and there was no agreement of any agency between the dealer and the purchaser. He further submitted that merely because, dealer was issued B licensee under the Coal Control Orders issued by the District Supply Officer and the dealer may be treated as Coal Agent under the U. P, Coal Control Order, but there should be a contract for commission agency which is not present in the present case and therefore, pre sales expenses including freight would be part of turnover. He relied upon the decision of Apex Court in the case of T. B. L. Remco Cement Distribution Company State of Tamil Nadu v. State Govt. reported in AIR 1993 S. C. page 123 Hindustan Sugar Ltd. v. State. 43 STC page 13 (SC) and latest judgment of this Court in the case of CIT v. Sunil Kumar Coal Agent. Gorakhour reported in UPTC 2003 page 1036.