Amounts collected by an assessee as a collecting agent for another entity are not includible in the assessee's turnover under the Bombay Sales Tax Act, 1959 or the Central Sales Tax Act, 1956.

The judgment of the Court was delivered by

DR. B. P. SARAF, J. - Both these references arise out of a common order of the Tribunal. The disputes relate to assessment for the period July 1, 1972 to June 30, 1973, both under the Bombay Sales Tax Act, 1959 and the Central Sales Tax Act, 1956. Two questions have been referred. On pertains to the determination of the sale price under the Bombay Sales Tax Act, 1959 ("Bombay Act" or "Act") and the other under the Central Sales Tax Act, 1956 ("Central Act"). The questions are as follows :

"1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in including the sum of Rs. 1,08,320 in the turnover of sales on the ground that it constitutes part of the sales price within the meaning of section 2(29) of the Bombay Sales Tax Act, 1959 ?

2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in including the sum of Rs. 20,928 in the turnover of sales on the ground that it constitutes part of the sale price within the meaning of section 2(h) of the Central Sales Tax Act, 1956 ?"

2. The controversy pertains to the includibility of the amounts mentioned in the questions, which had been collected by the assessee in addition to the price of the goods, as "State Federation commission" at the rate of one and one half per cent of the sale price of the goods in the "sale price" of those goods. According to the assessee it does not form part of the sale price within the meaning of section 2 (29) of the Bombay Act and section 2 (h) of the Central Act. The Sales Tax Officer treated it as a part of the sale price and included the amount collected by the assessee on that account in its turnover under both the Acts. The appeals of the assessee against the above action of the Sales Tax Officer were rejected both by the Assistant Commissioner of Sales Tax and the Maharashtra Sales Tax Tribunal. Hence this reference at the instance of the assessee.

3. The material facts, relevant for the determination of the controversy, are as follows :

The assessee, National Co-operative Consumers Federation of India Limited, is a co-operative society (hereinafter referred to as "the assessee") sponsored by the Government of India. The assessee-society lifts confiscated goods from Central Excise and New Customs House and distributes the same to the State Federations or their constituents throughout India. With a view to keep the prices under control and with a view to encourage co-operative movement in India, the assessee-society is also allowed to import dry fruits, textiles and other goods and to distribute the same to the State Federations or their constituents. Normally, the State Federations themselves supply these goods to the wholesale consume societies, department stores, etc., in their respective States. With a view to maintain price stabilisation at the State level, the State Federations charge from their constituents, i.e., the wholesale consumer societies, department stores, etc., in the State a commission known as State Federation commission, which is calculated at one and one half per cent of the sale price for the services rendered by it. Sometimes, the assessee-society distributes the goods directly to the wholesale consumer societies, etc., as per instructions of the respective State Federations and in such cases it includes in its invoices the amount payable by such purchasers to the State Federations a State Federation commission in addition to the price of the goods. The amounts so received by the assessee for and on behalf of the State Federations are credited by it to the accounts of the respective State Federations and remitted to them at the end of the year. For the period July 1, 1972 to June 30, 1973, the assessee had included in its invoices in respect of sales falling under the Bombay Act a sum of Rs. 1,08,320 as State Federation commission. The Sales Tax Officer, while assessing the assessee under the B