Order

14/02/2024

1. All the above referred revision petitions are filed under Section 86 of the Rajasthan Sales Tax Act, 1994.

2. Common question of law arises for consideration as to whether the respondent-distributor while selling the LPG Gas Cylinders to the dealers can charge transportation charges separately under an agreement between the parties and the taxing authorities have erred in making assessment and demand of taxes for transportation charges by including them in the sale price.

3. Tax Revision Petition No. 186/2005 relates to assessment year 2001-02, Tax Revision Petition No. 98/2007 relates to assessment year 2000-01 and Tax Revision Petition No. 261/ 2007 relates to assessment year 2002-03. Parties are the same.

4. A brief fact of the case is that the respondent is a dealer of LPG Cylinders. The respondent had entered into an agreement separately with the distributors that carriage charges would be payable for transportation of LPG Cylinders from the business premise of the respondent and accordingly was charging the same. On 8.9.2000, the Assistant Commercial Tax Officer made survey of the business premise of the respondent and found that the respondent dealer was charging delivery charges from the distributors in the bills issued on sale of LPG cylinders. In the circumstance, the delivery charges should have been included in the “sale price”, which was not done in different assessment years, therefore, the taxing authority included the same and imposed fine separately for non-inclusion of the same by the respondent.

5. The order of the Taxing Authority was challenged in separate appeals under Section 84 of the Act before the Deputy Commissioner (Appeals), Commercial Taxes, Jodhpur, who allowed the appeals of the distributor/respondent by different orders. Appeal No. 2/RST/Pali/2002-03 was disposed of on 05.07.2002, Appeal No. 45/2021-22/RST was disposed of on 13.02.2002 and Appeal No. 2/RST/Pali/2002-03 was disposed of on 05.07.2002. The Appellate Authority set aside the order of the Taxing Authority. Thereafter, the Taxing Authority challenged the orders of the appellate authority before the Rajasthan Tax Board under Section 85 of the Act. The Tax Board also dismissed the appeals and dismissals are under challenge in the instant revision applications. 6. Section 2(39) of the Rajasthan Sales Tax Act, 1994 defines “sale price” as follows:-

“(39) “sale price” means the amount paid or payable to a dealer as consideration for the sale less any sum allowed by way of any kind of discount or rebate according to the practice normally prevailing in the trade, but inclusive or any sum charged for anything done by the dealer in respect of the goods at the time of or before the delivery thereof;

Explanation I.

In the case of a sale by hire purchase agreement, the prevailing market price of the goods on the date on which such goods are delivered to the buyer under such agreement, shall be deemed to be the sale price of such goods.

Explanation II.

Where according to the terms of a contract, the cost of freight and other expenses in respect of the transportation of goods are incurred by the dealer for or on behalf of the buyer, such cost of freight and other expenses shall not be included in the sale price but the burden of such proof shall lie on the dealer.”

7. Learned counsel for the petitioner submits that both the Courts below have erred in law in interpreting the statutory provisions aforesaid. Reliance has been placed on the judgment in M/s. Indian Oil Corporation Ltd. Vs. Asst. Commissioner of Commercial Tax Special Circle, Rajasthan, Jaipur, decided by a Bench of this Court on 20.03.2015.

8. Learned counsel for the respondent contends that the statutory provision is clear enough especially explanation II to Section 2(39) of the Act, that under a contract, the cost of freight and other expenses in respect of the transportation of goods shall not be included in the sale price but the burden of proof shall lie on the dealer. Lea