FRONTIER BOOT HOUSE Vs. COMMISSIONER OF SALES TAX

JUDGEMENT

(1.) THE Sales Tax Tribunal (Board of Revenue, M. P.), at the instance of the assessee, has made this reference under Section 44 (1) of the M. P. General Sales Tax Act, 1958. The questions referred to us for our decision are:

(2.) THE assessee is a dealer in foot-wear. During the assessment proceedings for the period 1st April, 1961, to 31st March, 1962, the assessee claimed deduction in the sum of Rs. 56,492. 31 on the ground that this sum represented the sale price of foot-wear purchased from local manufacturers and that such sales were exempt from sales tax under entry 5 of the First Schedule. This claim was negatived by the departmental authorities, and the Sales Tax Tribunal also agreed with the departmental authorities. The Sales Tax Officer also added Rs. 29,773. 77 to the taxable turnover returned by the assessee. This amount represented the sales tax separately collected by the assessee from its customers. According to the departmental authorities, the sales tax, though separately recovered, formed part of the sale price and as such was liable to be included in the taxable turnover. The assessee had challenged unsuccessfully the addition of the said amount also. The questions referred to us relate to these two matters.

(3.) SECTION 10 of the M. P. General Sales Tax Act provides that no tax shall be payable on the sales or purchases of goods specified in the second column of Schedule I subject to the conditions and exceptions, if any, set out in the corresponding entry in the third column thereof. Entry 5 of the First Schedule is to the following effect :