COMMISSIONER OF SALES TAX Vs. PREMIER AUTOMOBILES LTD

JUDGEMENT

(1.) This is a reference under section 61(1) of the Bombay Sales Tax Act, 1959 read with section 9(2) of the Central Sales Tax Act, 1956 (referred to hereinafter as "the said Act"). The question referred to us for our determination is as follows :

(2.) The contention of Mr. Jetly, learned counsel for the applicant, the Commissioner of Sales Tax, before us is that these service pool charges were collected by the respondent from its distributors against the sale of its cars to the distributors. If the distributor concerned wanted the delivery of a car he had to pay the service pool charges, namely, Rs. 10 per car, and the distributors did not have any option as to whether they wanted the benefit of the aforementioned scheme on payment of the service pool charges of Rs. 10 per car. It was contended by Mr. Jetly that in view of this, the amount of the service pool charges per car should be included in the computation of the turnover of sales under the said Act. It was, on the other hand, contended by Mr. Phadkar that these service pool charges were really not a part of sale price of the car, but were paid paid for maintaining the service promotion pool in the benefit of which the distributors participated.

(3.) Before going into the merits of the respective contentions set out earlier, it will be useful to take note of the relevant provisions of the said Act. Sub-section (h) of section 2 of the said Act runs as follows :