TCS is required to be done on GST components also?

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TCS is required to be done on GST components also?

 

On which amount TCS is required is one of the most common questions that is raised by the taxpayers?  The question is all the more important as the scope of Tax Collection at Source (TCS) is set to increase tremendously by virtue of section 206C(1H). Presently, TCS is applicable on sale of Liquor, Timber wood, Tendu Leaves, Scrap, Minerals, Motor Vehicle exceeding Rs. 10 Lakh, Parking lot, Toll Plaza and Mining and Quarrying.  W.e.f. 01.10.2020, every seller having whose turnover in the FY 2019-20 is more than Rs. 10 Crore will be required to collect Tax at Source @ 0.075% if the value or aggregate value of sale to any buyer during the year exceeds Rs. 50 Lakh.  It may be noted that the rate of TCS is 0.10%. However, due to Covid– 2019, the rate has been reduced to 0.075% till 31.03.2020. The TCS rate will be 0.75% if the PAN/Adhar of the buyer is not available with the seller.

Whether the amount will include the amount of GST, Excise also? It may be noted that TCS is required to be collected from the buyer.

There is one circular No. 585 Dated 27/11/1990 issued by CBDT which is worth reproducing here:

CIRCULAR NO. 585 DATED 27TH NOVEMBER, 1990

Collection of income-tax at source under s. 206C of the IT Act, 1961 in respect of profits and gains from the business of trading in alcoholic liquor, forest produce, etc.—Regarding

Reference is invited to Board’s Circular No. 565 [F.No. 275A/1/90-IT(B)] dt. 11th July, 1990 regarding collection of income-tax at source under s. 206C of the IT Act in respect of profits and gains from the business of trading in alcoholic liquor, forest produce, etc., as also to earlier circulars referred in paragraph 1 of Circular No. 565.

  1. As a result of different systems prevailing in different States, the term “purchase price”, used in s. 44AC of the IT Act was being understood in different ways. In order to clarify this point, the Finance Act, 1990 has amended the said section to provide that the purchase price would mean any amount (by whatever name called) paid or payable by the buyer to obtain the goods referred to in that section, except the bid amount in an auction. Accordingly, the excise duty paid or payable by the buyer will also form part of the purchase price for the purposes of s. 44AC. On the same analogy, the “Nirgam Mulya” or issue price which is paid by a buyer in the State of Uttar Pradesh will also form part of the purchase price. Thus, income tax will have to be collected at source under the provisions of s. 206C by all persons referred to in s. 44AC of the IT Act, 1961 (e.g. Central Government, State Government, local authority, Corporations, etc.,) at the specified rates, with reference to the purchase price including the excise duty, etc.
  2. The above amendment has come into force w.e.f. the asst. yr. 1991-92 and, therefore, will be applicable to the collections under s. 206C made during the financial year 1990-91.
  3. The Finance Act, 1990 has further amended s. 44AC so as to include a “co-operative society” also within the meaning of the term “seller” as defined therein. The said amendment has also come into effect from the assessment year 1991-92 and will, accordingly, apply to collections made under s. 206C during the financial year 1990-91.

[F.No. 275A/8/90-IT(B), reported in (1990) 90 CTR (St) 26 : (1990) 186 ITR (St) 155]

High Court Of Madhya Pradesh : Gwalior Bench in the case of Vinod Rathore Vs. Union Of India & Ors has held as under:

  1. As per intent of s. 206C, tax is liable to be recovered on the actual amount paid by the buyer.
  2. Buyer is required to pay the cost of liquor which includes excise duty. (Even after GST implementation in general, Excise is continued in some items and GST is not applicable in such cases).
  3. Purchaser is required to pay the cost of liquor price which includes excise duty. Under the law, purchaser is not in a position to get liquor without payment of excise duty. Since the purchase price is inclusive of excise duty, therefore, tax will be recoverable on the actual price paid by the buyer inclusive of tax and excise duty.
  4. Even Letter written by the Finance Minister to some MPs communicating that collection of tax at source is to be made only in respect of cost of liquor supplied by the Madhya Pradesh Government has no statutory force
  5. Letter simplicity written by the Finance Minister will not have any statutory force unless the Act is amended and rules are made there under.
  6. Recovery of tax on the price of liquor with all taxes and excise duty is not bad in law, and recovery of tax by the authorities is just and proper.
  7. The court have relied on McDowell & Co. Ltd. vs. CTO (1985) 47 CTR (SC) 126, AIR 1986 SC 649 and overruled the judgment of  Harvansh & Sons vs. Union of India (2004) 186 CTR (MP) 364 : 2002 (4) MPLJ 495.
  8. The court concluded that tax is recoverable under s. 206C on the actual price of liquor paid by the buyer inclusive of excise duty.

The complete order is produced hereunder for the benefit of the readers:

 

VINOD RATHORE vs. UNION OF INDIA & ORS.

HIGH COURT OF MADHYA PRADESH : GWALIOR BENCH

S.S. Jha & A.K. Gohil, JJ.

Writ Petn. No. 824 of 2001

17th January, 2005

(2005) 73 CCH 0075 MPHC

(2005) 195 CTR 0210 : (2005) 278 ITR 0122 : (2005) 146 TAXMAN 0032

Legislation Referred to

Section 206C,

Case pertains to

Asst. Year —

S.S. JHA, J.

 

This reference is made by the single Bench to decide the following question of law :

Whether collection of tax at source under s. 206C of the IT Act on the price of liquor shall include excise duty paid for purchase of liquor ?

  1. Counsel for the petitioner in support of his contention has relied upon the judgment in the case of Vinod Kumar Rathore vs. Union of India (Writ Petn. No. 2325 of 1996 decided on 30th Nov., 1999). This judgment was delivered relying upon the judgment in the case of Ashok Kumar & Ors. vs. Union of India (Writ Petn. No. 1042 of 1995 decided on 12th Sept., 1996). Counsel for the petitioner submitted that these two judgments have been followed in another judgment of this Court in the case of Harvansh & Sons vs. Union of India (2004) 186 CTR (MP) 364 : 2002 (4) MPLJ 495. Counsel for the petitioner submitted that the costs of liquor will not include excise duty but will include the cost price of liquor. He submitted that under s. 206C of the IT Act (hereinafter, referred to as the “Act”), tax at source can be deducted only on the cost price and not on the price including the excise duty.
  2. Counsel for the respondent—Department submitted that the aforesaid judgments have not laid down the correct law and s. 206C of the Act has not been interpreted properly. He submitted that this question has been determined by the apex Court in the case of McDowell & Co. Ltd. vs. CTO (1985) 47 CTR (SC) 126 : AIR 1986 SC 649 whereby earlier judgment in the case of McDowell & Co. Ltd. vs. CTO 1977 CTR (SC) 79 : AIR 1977 SC 1459 has been overruled. He invited attention of this Court to the judgment in the case of Hindustan Sugar Mills vs. State of Rajasthan AIR 1978 SC 1496 and submitted that the question of sale price has been considered in this case. In this case question of sale price chargeable by the purchaser under the scheme of cement control order and the sales-tax levied upon the said product was considered. In para 17 of the judgment, it has been held that the amount of freight formed part of the “sale price” within the meaning of the first part of the definition of that term and was includible in the turnover of the assessee. Counsel for the respondents, therefore, submitted that for collection of tax at source under s. 206C of the Act, price of liquor shall include the excise duty paid for purchase of liquor. He submitted that whatever amount is spent by the purchaser for buying the liquor is subject to deduction of tax at source which shall be finally determined after the assessee has submitted return and assessment orders are passed by the IT Department.
  3. To consider the provisions, it will be appropriate to reproduce s. 206C of the Act :

“206C. (1) Every person, being a seller shall, at the time of debiting of the amount payable by the buyer to the account of the buyer or at the time of receipt of such amount from the said buyer in cash or by the issue of a cheque or draft or by another mode, whichever is earlier, collect from the buyer of any goods of the nature specified in column (2) of the table below, a sum equal to the percentage, specified in the corresponding entry in column (3) of the said table, of such amount as income-tax :

 

Table

Sr. No. Nature of goods Percentage
(i) Alcoholic liquor for human consumption (other than Indian-made foreign liquor) and tendu leaves Ten per cent
(ii) Timber obtained under a forest lease Fifteen per cent
(iii) Timber obtained by any mode other than under a forest lease Five per cent
(iv) Any other forest produce not being timber or tendu leave Fifteen per cent.

Provided that where the AO, on any application made by the buyer, gives a certificate in the prescribed form that to the best of his belief any of the goods referred to in the aforesaid table are to be utilized for the purposes of manufacturing, processing or producing articles or things and not for trading purpose, the provisions of this sub-section shall not apply so long as the certificate is in force.

(2) The power to recover tax by collection under sub-s. (1) shall be without prejudice to any other mode of recovery.

(3) Any person collecting any amount under sub-s. (1) shall pay within seven days the amount so collected to the credit of the Central Government or as the Board directs.

(4) Any amount collected in accordance with the provisions of this section and paid under sub-s. (3) shall be deemed as payment of tax on behalf of the person from whom the amount has been collected and credit shall be given to him for the amount so collected on the production of the certificate made under this Act for the assessment for which such income is asses sable.

(5) Every person collecting tax in accordance with the provisions of this section shall within ten days from the date of debit or receipt of the amount furnish to the buyer to whose account such amount is debited or from whom such payment is received, a certificate to the effect that tax has been collected, and specifying the sum so collected, the rate at which the tax has been collected and such other particulars as may be prescribed.

(5A) Every person collecting tax in accordance with the provisions of this section shall prepare half-yearly returns for the period ending on 30th September and 31st March in each financial year, and deliver or cause to be delivered to the prescribed income-tax authority such returns in such forms and verified in such manner and setting forth such particulars and within such time as may be prescribed.

(5B) Notwithstanding anything contained in any other law for the time being in force, a return filed on a floppy, diskette, magnetic cartridge tape, CD-ROM or any other computer readable media as may be specified by the Board (hereinafter, referred to as the computer media) shall be deemed to be a return for the purposes of sub-s. (5A) and the rules made thereunder and shall be admissible in any proceedings thereunder, without further proof of production of the original as evidence of any contents of the original or of any fact stated therein.

(5C) A return filed under sub-s. (5B) shall fulfil the following conditions, namely :

(a) while receiving returns on computer media, necessary checks by scanning the documents filed on computer media will be carried out and the media will be duly authenticated by the AO; and

(b) the AO shall also take due care to preserve the computer media by duplication, transferring, mastering or storage without loss of data.

(6) Any person responsible for collecting the tax who fails to collect the tax in accordance with the provisions of this section, shall, notwithstanding such failure, be liable to pay the tax to the credit of the Central Government in accordance with the provisions of sub-s. (3).

(7) Without prejudice to the provisions of sub-s. (6), if the seller does not collect the tax or after collecting the tax fails to pay it as required at the rate of (one and one-fourth) per cent per month or part thereof on the amount of such tax from the date on which such tax was collectible to the date on which the tax was actually paid.

(8) Where the tax has not been paid as aforesaid, after it is collected, the amount of the tax together with the amount of simple interest thereon referred to in sub-s. (7) shall be a charge upon all the assets of the seller.

(9) Where the AO is satisfied that the total income of the buyer justified the collection of the tax at any lower rate than the relevant rate specified in sub-s. (1), the AO shall on an application made by the buyer in this behalf, give to him a certificate for collection of tax at such lower rate than the relevant rate specified in sub-s. (1).

(10) Where a certificate under sub-s. (9) is given, the person responsible for collecting the tax shall, until such certificate is cancelled by the AO, collect the tax at the rates specified in such certificate.

(11) The Board may, having regard to the convenience of assessee and the interest of Revenue, by notification in the Official Gazette, make rules specifying the cases in which, and the circumstances under which, an application may be made for the grant of a certificate under sub-s. (9) and the conditions subject to which such certificate may be granted and providing for all other matters connected therewith.

Explanation : For the purposes of this section—

(a) “buyer” means a person who obtains in any sale, by way of auction, tender or any other mode, goods of the nature specified in the table in sub-s. (1) or the right to receive any such goods but does not include :

(i) a public sector company,

(ii) a buyer in the further sale of such goods obtained in pursuance of such sale, or

(iii) a buyer where the goods are not obtained by him by way of auction and where the sale price of such goods to be sold by the buyer is fixed by or under any State Act;

(b) “Seller” means the Central Government, a State Government or any local authority or corporation or authority established by or under a Central, State or Provincial Act, or any company or firm or co-operative society.”

Explanation (a) defines the word “buyer” which means a person who obtains in any sale of goods of the nature specified in the table or right to receive any such goods and “seller” means the Central Government, a State Government or any local authority or corporation or authority established by or under a Central, State or Provincial Act, or any company or firm or co-operative society.”

  1. Earlier, this question was considered by the two Judges Bench of the apex Court in the case of McDowell & Co. Ltd. vs. CTO (supra), wherein it was held that the manufacturer of Indian liquors or owner of a bonded warehouse is primarily responsible for payment of excise duty and countervailing duty, respectively, and the intending purchasers of the Indian liquors who seek to obtain distillery passes are also legally responsible for payment of excise duty which is collected from them by the authorities of the Excise Department. While considering the words “sale” and “turnover” occurring in Andhra Pradesh General Sales-tax Act, it is held that excise duty or countervailing duty is paid directly to the excise authorities by the purchaser of the Indian liquor before removal thereof from the distilleries or the bonded warehouse on the strength of the distillery and warehouses passes (and) is not included in the bills of sale as the consideration for the sales. It was held that the Sales-tax authorities were not competent to include in the turnovers of the dealers the excise duty and the countervailing duty which was not charged by them but was charged by and paid directly to the excise authorities by the buyers of the liquors.
  2. However, aforesaid judgment came up for consideration before the apex Court between the same parties in McDowell & Co. Ltd. vs. CTO (supra). Five Judges Bench of the apex Court has overruled the earlier judgment and while considering the definition of “turnover”, it is held that definition of the word “turnover” clearly indicates that the total amount charged as the consideration for the sale is to be taken into account for determining the turnover. Where a bill of sale is issued (and obviously the bill has to state the total amount charged as consideration), the total amount set out therein is to be taken into consideration. Excise duty though paid by the purchaser to meet the liability of the manufacturer, is a part of the consideration for the sale and is includible in the turnover of the manufacturer. The purchaser has paid the tax because the law asks him to pay it on behalf of the manufacturer.
  3. In the case of Union of India vs. Om Prakash S.S. & Co. (2001) 3 SCC 593, provisions of s. 206C of the IT Act, 1961, have been considered. It is held that the aforesaid section refers to a case where by reason of the payment to the seller, the buyer gets specific goods mentioned in the table to the said section or gets a right to collect or receive those goods by virtue of that payment. When the Government issues a licence, it only enables the licensee to carry on trade or business in that item. The payment made by the licensee by way of licence fee does not, ipso facto, entitle the licensee to lift the goods. For obtaining the goods mentioned in the table, the licensee has to place an order on the manufacturer or the supplier of the said goods and it is at that point of time that s. 206C would get attracted. While interpreting the word “buyer” occurring in s. 206C(11), it is held that the word “buyer” would mean where a person by virtue of the payment gets a right to receive specific goods and not where he is merely allowed or permitted to carry on business in that trade. It is held that the buyer has to be buyer of goods and not merely a person who acquires a licence to carry on the business.
  4. While delivering the earlier judgment in the case of Ashok Kumar (supra), the Court has relied upon a letter dt. 1st Aug., 1994, written by the Finance Minister to some Member of Parliament and it was communicated that collection of tax at source only in respect of cost of liquor supplied by the Madhya Pradesh Government has been found acceptable and necessary instructions in this regard have been issued to the concerned authorities. Relying upon the aforesaid letter, this Court without entering into the merits of the case held that the authorities shall make collection of tax at source only in respect of cost of liquor supplied by the Government of Madhya Pradesh in conformity with the letter dt. 1st Aug., 1994 and instructions issued in this regard so far as those petitioners are concerned. Thus, consent order was passed in that petition which has been followed in the cases of Vinod Rathore and Harvansh & Sons (supra). However, while delivering the judgment relying upon the aforesaid letter of the Finance Minister, Circular No. 585, dt. 27th Nov., 1990, has not been brought to the notice of the Court. The circular is reproduced below :

“Collection of income-tax at source under s. 206C of the IT Act, 1961, in respect of profits and gains from the business of trading in alcoholic liquor, forest produce, etc.—Regarding

Reference is invited to Board’s Circular No. 565 [F. No. 275A/1/90-IT(B)], dt. 11th July, 1990 [(1990) 184 ITR (St) 166], regarding collection of income-tax at source under s. 206C of the IT Act in respect of profits and gains from the business of trading in alcoholic liquor, forest produce, etc. as also to earlier circulars referred in para 1 of Circular No. 565.

(2) As a result of different systems prevailing in different States, the term “purchase price”, used in s. 44AC of the IT Act, 1961, was being understood in different ways. In order to clarify this point, the Finance Act, 1990, has amended the said section to provide that the purchase price would mean any amount (by whatever name called) paid or payable by the buyer to obtain the goods referred to in that section, except the bid amount in an auction. Accordingly, the excise duty paid or payable by the buyer will also form part of the purchase price for the purposes of s. 44AC. On the same analogy, the “Nirgam Mulya” or issue price which is paid by a buyer in the State of Uttar Pradesh will also form part of the purchase price. Thus, income-tax will have to be collected at source under the provisions of s. 206C by all persons referred in s. 44AC of the IT Act, 1961 (e.g., Central Government, State Government, local authority, corporations, etc.), at the specified rates, with reference to the purchase price including the excise duty, etc.

(3) The above amendment has come into force with effect from the asst. yr. 1991-92, and, therefore, will be applicable to the collections under s. 206C made during the financial year 1990-91.

(4) The Finance Act, 1990, has further amended s. 44AC so as to include a “co-operative society” also within the meaning of the term “seller” as defined therein. The said amendment has also come into effect from the asst. yr. 1991-92 and will, accordingly, apply to collections made under s. 206C during the financial year 1990-91.

(5) This may please be brought to the notice of all concerned. In case any assistance is required in this regard, the concerned AO or the local public relation officer of the IT Department may be approached.

(6) Copies of this circular are available with the Director of Income-tax (RSP & PR), 6th Floor, Mayur Bhavan, Conn aught Circus, New Delhi.”

  1. Question involved in the petition is whether the letter of the Finance Minister will override the provisions of the Act.
  2. Letter simplicity written by the Finance Minister will not have any statutory force unless the Act is amended and rules are made thereunder. In the present case, purchaser is required to pay the cost of liquor price which includes excise duty. Under the law, purchaser is not in a position to get liquor without payment of excise duty. Since the purchase price is inclusive of excise duty, therefore, tax will be recoverable on the actual price paid by the buyer inclusive of tax and excise duty. As per intent of s. 206C of the Act, tax is liable to be recovered on the actual amount paid by the buyer, therefore, as and when return is submitted by the buyer and after assessment, if it is found that some excess payment has been made towards the tax, it may be ordered to be returned by the competent authority. Recovery of tax on the price of liquor with all taxes and excise duty is not bad in law, and recovery of tax by the authorities is just and proper.
  3. Therefore, we hold that the judgments delivered in the cases of Ashok Kumar, Vinod Rathore and Harvansh & Sons (supra) do not lay down the correct law. In the aforesaid judgment, reliance has been placed upon the letter of the Finance Minister. However, no circular or notification has been issued in pursuance thereof. There is nothing on record to prove the authenticity of the letter. In any case, letter will not override the statutory provisions and the provisions of law. Deduction at source is the best way of recovery of tax and protect the recovery. However, if some excess payment is made, same can be refunded after order of final assessment is passed. We, therefore, answer the reference in affirmative in favour of Revenue and hold that the purchase price will include the excise duty paid by the buyer.
  4. Now the petition be placed before the regular Bench for its decision on merit.

However, in addition to above, there are few other important observation by other courts as well. The same is compiled hereunder:

PURCHASE PRICE WITHIN MEANING OF S. 206C

Percentage referred to in section 206C(1) are related to the purchase price and not to the income component of the purchase price (specified as profits and gains of the said business in section 44AC). Percentage referred to in section 206C(1) would be intelligible only if they are related to purchase price. The percentages mentioned in column 3 of the Table in sub-s. (1) of section 206C are relatable to the purchase price, and not to the income component of the purchase price. If they are related to the percentage of profits and gains specified in section 44AC, the level of collection at source provided by section 206C(1) would not serve the object underlying the provisions [A. Sanyasi Rao vs. Govt. of Andhra Pradesh & Ors. (1989) 77 CTR (AP) 40 : (1989) 178 ITR 31 (AP) : TC5R.614A. See also Sat Pal & Co. vs. Excise & Taxation Commissioner, Haryana & Ors. (1990) 89 CTR (P&H) 13 : (1990) 185 ITR 375 (P&H) : TC5R.621].

According to K.K. Mittal & Co. vs. Union of India (1990) 90 CTR (P&H) 50 : (1991) 187 ITR 208 (P&H) : TC5R.622, in view of Government communication exempting liquor contractors in the State of U.P. from the purview of collection of tax under section 206C r/w section 44AC, in respect of issue price, no tax could be deducted in respect of excise duty of country made liquor payable by licence holders (L-14) in the States of Punjab and Haryana.

In view of insertion of Explanation to cl. (a) of sub-s. (1) of section 44AC by the Finance Act, 1990 defining purchase price it now includes any amount paid or payable to obtain the goods except the bid money.

The Punjab & Haryana High Court has held in the case of Fairdeal Trading Co. & Ors. vs. Union of India & Ors. (1993) 112 CTR (P&H) 17 : TC5PS.52 that “Parliament in its wisdom while enacting section 206C has not said that tax is to be collected on the ‘purchase price’ of liquor but it is to be collected only on the amount that is payable at the time of purchase after the distillery permit has been obtained. In other words, tax is to be collected at source on the amount actually payable by the buyer to the seller at the time when liquor is purchased. The use of the word ‘payable’ is significant and so is the point of time. A plain reading of section 206C leaves no room for doubt that the quantum of the amount on which the tax is to be collected at source by the seller has to be only that amount which is to be paid to the seller as a price at the time of the sale and cannot, by any stretch of reasoning, be held to include the excise duty which has already been paid to obtain the permit to enable the licensee to purchase the liquor. Therefore, the sellers, namely, distilleries (manufacturers) are not entitled to collect tax at source on the amount of excise duty already paid by the buyers in the Government treasury as that is not the amount payable by them to the sellers at the time of sale/purchase of liquor”.

In CIT & Anr. vs. District Excise Officer (2006) 284 ITR 22 (Uttaranchal) it was held that in case of sale of liquor by District Excise Officer, basic licence fee did not form part of purchase price and hence District Excise Officer was not liable to collect at source on the basic licence fee.

In Ashok Kumar & Ors. vs. Union of India & Ors. (2001) 252 ITR 200 (P&H) it was held that licence fee paid by holders of licence L14 or L14A is not part of the amount payable at the time of sale of country liquor and hence such holders do not fall within the meaning of the term “buyer” under s. 206C of the IT Act in respect of such licence fee with the result that excise authorities were not entitled to collect 10 per cent of such licence fee in the form of income-tax.

The Patna High Court has also held in the case of Ramjee Prasad Sahu & Ors. vs. Union of India (1993) 114 CTR (PAT) 326 : TC5PS.134A that income-tax under section 206C is collectible by the wholesalers from retailers only on the cost price of country liquor purchased by retailers and not on excise duty also which is paid directly by the retailers to the State and does not form part of price of country liquor. This has been reiterated in Madan Mohan Gupta vs. Union of India Ors. (1993) 204 ITR 384 (PAT) : TC5PS.147. However in M.A. Majeed & Anr. vs. Divisional Forest Officer & Anr (1993) 115 CTR (KER) 19 : TC5PS.148, it was held that the tax has to be collected on the sum payable by the buyer which included sales-tax and other forest development tax and not only on sale proceed. On the facts of the case, it was observed : “It is clear from the statute itself that in the case of sale of timber obtained by any mode other than under a forest lease, what is required to be collected is 10% of the sum payable by the buyer. It is stated that the Departmental instructions have been issued to the effect that, in view of the proposed amendment, instead of 10% income-tax, 5% need be collected from the purchaser of timber other than those obtained under forest lease. It is also the petitioner’s case that petitioners are liable to pay at the rate of 5% only of the sales proceeds and not the entire amount which includes sales-tax and other forest development tax. The instructions stated to have been issued by the CIT cannot override the statutory provisions which require collection at the rate of 10%. It is, however, agreed that, in view of the instructions issued, it may be necessary only to collect at the rate of 5% and require the purchaser to furnish security for the remaining 5% of the total amount. The contention that what is to be taken into account is only the sale proceeds and not the total amount is devoid of merit.”

The Patna High Court in Bharat Prasad Chaudhary & Ors. vs. Union of India (1998) 229 ITR 363 (Pat) following Ramjee Prasad Sahu & Ors. vs. Union of India (1994) 122 CTR (MP) 19 : TC5PS.134 has held that in liquor business, no tax is to be collected by seller from retail vendors on amount deposited by way of excise duty directly with State Government.

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