J. S. VERMA, C.J. - This is a revision against the Board of Revenue's order dated 18th February, 1980 rejecting the department's contention regarding inclusion of an additional amount in the sale price for the purpose of computation of the taxable turnover of the assessee. The assessee carries on the business of selling tyres. According to the prevailing practice, if a tyre is found defective, it is replaced with a new tyre. However, in some cases where the tyre has been used for some time, a part of the price is charged while replacing it with a new tyre. There is no dispute that where the replacement by a new tyre is without charging any additional amount, no question arises for payment of sales tax in addition to the tax paid on the initial transaction. For the other category of cases the assessee pays sales tax also on the additional amount charged from the customer while making the replacement. The department contends that in such cases the assessee should pay sales tax on the entire price of the tyre and not merely on the amount charged from the customer while making the replacement. This contention has been rejected by the Board of Revenue.

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