Case Law Details
The Commissioner of Sales Tax Vs. M/s. Ravi Trading Company (Bombay High Court)
In the present case, passing of the property in goods to the buyer is at the place and time of spot delivery. After the sale is complete, even if the assessee sellor retains the possession of the goods sold and incurs the expenditure of insurance and carrying the goods at the destination of the buyer, he performs these functions in his capacity as a bailee’, as contemplated by Section 148 of the Indian Contract Act, 1872, who shall be entitled to reimbursement of such expenses from the ‘bailor’, as specified under Section 158 therein. Such charges of insurance and carrying incurred by the assessee sellor cannot, therefore, constitute a ‘sale price’ within the meaning of Section 2(29) of the BST Act.
In view of above, we hold that in the facts and circumstances of this case, the Tribunal was justified in holding that the insurance charges and carrying charges do not form part of the sale price for the reason that the sale was completed at the point of spot delivery and the insurance and carrying charges were incurred thereafter.
Full Text of the High Court Judgment / Order is as follows:-
Please become a Premium member. If you are already a Premium member, login here to access the full content.
