State of Karnataka &amp; Others Vs. M/s. Sri Chamundeswari Sugar Ltd
of sugarcane and the Government would be entitled to enforce the liability."38.4. It was also observed in the same paragraph that the State Government acted in its statutory capacity to fix the higher price of the sugarcane. 13. It is to be noted that in the State of U.P. the SAP forms part of the agreement. In the instant case it is not there. Paras 39 and 40 of U.P. Cooperatives case (supra) deal with question of statutory price. In Ponni Sugars case (supra) the decision in U.P. Cooperatives case (supra) was followed. The controversy appears to have been blown out of proportion. There is no dispute that respondent paid the SAP which is subject to certain adjustments. That being so, the respondent cannot take the plea that because it was agreed by the grower and the purchaser that certain amount would be paid, that does not in any way render the amount paid as SAP irrelevant. In fact, an agreement cannot determine the question of liability to pay the purchase tax. Section 6 of the Act reads as follows: "6. Levy of purchase tax under certain circumstances.- Subject to the provisions of sub-section (5) of Section 5, every dealer who in the course of his business purchases any taxable goods in circumstances in which no tax under Section 5 is leviable on the sale price of such goods, and(i) either consumes such goods in the manufacture of other goods for sale or otherwise (or consumes otherwise) or disposes of such goods in any manner other than by way of sale in the State, or(ii) despatches them to a place outside the State except as a direct result of sale or purchase in the course of inter-State trade or commerce,shall be liable to pay tax on the purchase price of such goods at the same rate at which it would have been leviable on the sale price of such goods under Section 5." 14. It is the stand of the respondent that purchase price is not defined and, therefore, the agreed price would be taken to be the purchase price. This plea is clearly unsustainable. As noted above, the basic question is what is the consideration paid for effecting the purchase. 15. The definition of "Sale" (in Section 2(t) of the Act) is relevant. It refers to transfer of the property in goods by one person to another in the course of trade or business "for cash or for deferred payment or other valuable consideration". "Purchase price" is well-known expression in commercial transactions. Every purchase involves a corresponding sale. The purchase money or purchase price for property is the price to be paid for it. Speaking technically, acquires by "words of purchase" and is a "purchaser" when he obtains title in any other mode than by descent or devolution of law. It was noted in Commissioner of Income Tax, Andhra Pradesh v. T.N. Aravinda Reddy (1979 (4) SCC 721 ) as follows: "The meaning of the word purchase in Section 54, Clause (i) of the Income Tax Act, 1961does not differ from its plain meaning which sense buying for a price equivalent of price by payment in kind or adjustment towards an old debt or for other monetary consideration. Each release in the circumstances of the given case is a transfer of the releasers share for valuation to the release. In plain English, the transferee purchases the share of each of his brothers. Thus Section 54, Clause (i) is attracted." 16. Normal meaning of the word purchase is acquisition for money or for any consideration. That is the primary meaning. In Concise Oxford Dictionary, apart from the two meanings "buy, acquire", another meaning given to the word "purchase" is "procure". The word "procure" consists of much wider import than the word "purchase". In the same dictionary, the word "procure" has been mentioned the meaning as "obtained by care or effort acquire". Purchase is thus a word of restricted meaning than the word "procure". While considering a taxing statute which deals with income from business the word "purchase" will therefore, have to be seen in the commercial sense. In the commercial sense, a transaction of purchase is a part of a transaction of sale. A transaction of sale can never be complete unless there is a transfer of property from the seller as well and the buyer who is the purchaser, must, therefore, acquire the property before he can claim to have purchased the property.17. In the Sale of goods Act and also in the Central Sales Tax Act or in any of the sales tax laws made in the several States, the definition includes the sale of goods, and not to the purchase of goods. That must be so because the sale of a commodity must include within its ambit the concept of sale as well as purchase. It is not possible to conceive of a sale of goods without a buyer.18. It is fairly accepted that SAP has been paid. The claim of the respondent is that determination is tentative and certain adjustments can be made later. But till that is done the SAP has to be taken as the consideration. In our view appellants were justified in demanding purchase tax on the amount paid as SAP and the High Courts view is clearly unsustainable and is set aside. The view expressed in Ponni Sugars case (supra) is in consonance with the view expressed by the Constitution Bench in U.P. Cooperatives case (supra). The observations relating to the agreed price which is above the lowest permissible rate cannot read to mean that any ceiling is fixed by the agreed price. In fact in Ponni Sugars case (supra) and U.P. Cooperatives case (supra) this Court held that the price fixed under the Control Order was the minimum price and it was the lowest permissible rate. The highest amongst the three prices relatable to the purchase is the price on the basis of which the purchase tax is to be levied.
1[ds]It is the stand of the respondent that purchase price is not defined and, therefore, the agreed price would be taken to be the purchase price.This plea is clearlythe commercial sense, a transaction of purchase is a part of a transaction of sale. A transaction of sale can never be complete unless there is a transfer of property from the seller as well and the buyer who is the purchaser, must, therefore, acquire the property before he can claim to have purchased the property.17. In the Sale of goods Act and also in the Central Sales Tax Act or in any of the sales tax laws made in the several States, the definition includes the sale of goods, and not to the purchase of goods. That must be so because the sale of a commodity must include within its ambit the concept of sale as well as purchase. It is not possible to conceive of a sale of goods without a buyer.18. It is fairly accepted that SAP has been paid. The claim of the respondent is that determination is tentative and certain adjustments can be made later. But till that is done the SAP has to be taken as the consideration. In our view appellants were justified in demanding purchase tax on the amount paid as SAP and the High Courts view is clearly unsustainable and is set aside. The view expressed in Ponni Sugars case (supra) is in consonance with the view expressed by the Constitution Bench in U.P. Cooperatives case (supra). The observations relating to the agreed price which is above the lowest permissible rate cannot read to mean that any ceiling is fixed by the agreed price. In fact in Ponni Sugars case (supra) and U.P. Cooperatives case (supra) this Court held that the price fixed under the Control Order was the minimum price and it was the lowest permissible rate. The highest amongst the three prices relatable to the purchase is the price on the basis of which the purchase tax is to be levied.
### Instruction:
Judge the probable resolution of the case (approval (1) or disapproval (0)), and elaborate on this forecast by extracting and interpreting significant sentences from the proceeding.

### Input:
of sugarcane and the Government would be entitled to enforce the liability."38.4. It was also observed in the same paragraph that the State Government acted in its statutory capacity to fix the higher price of the sugarcane. 13. It is to be noted that in the State of U.P. the SAP forms part of the agreement. In the instant case it is not there. Paras 39 and 40 of U.P. Cooperatives case (supra) deal with question of statutory price. In Ponni Sugars case (supra) the decision in U.P. Cooperatives case (supra) was followed. The controversy appears to have been blown out of proportion. There is no dispute that respondent paid the SAP which is subject to certain adjustments. That being so, the respondent cannot take the plea that because it was agreed by the grower and the purchaser that certain amount would be paid, that does not in any way render the amount paid as SAP irrelevant. In fact, an agreement cannot determine the question of liability to pay the purchase tax. Section 6 of the Act reads as follows: "6. Levy of purchase tax under certain circumstances.- Subject to the provisions of sub-section (5) of Section 5, every dealer who in the course of his business purchases any taxable goods in circumstances in which no tax under Section 5 is leviable on the sale price of such goods, and(i) either consumes such goods in the manufacture of other goods for sale or otherwise (or consumes otherwise) or disposes of such goods in any manner other than by way of sale in the State, or(ii) despatches them to a place outside the State except as a direct result of sale or purchase in the course of inter-State trade or commerce,shall be liable to pay tax on the purchase price of such goods at the same rate at which it would have been leviable on the sale price of such goods under Section 5." 14. It is the stand of the respondent that purchase price is not defined and, therefore, the agreed price would be taken to be the purchase price. This plea is clearly unsustainable. As noted above, the basic question is what is the consideration paid for effecting the purchase. 15. The definition of "Sale" (in Section 2(t) of the Act) is relevant. It refers to transfer of the property in goods by one person to another in the course of trade or business "for cash or for deferred payment or other valuable consideration". "Purchase price" is well-known expression in commercial transactions. Every purchase involves a corresponding sale. The purchase money or purchase price for property is the price to be paid for it. Speaking technically, acquires by "words of purchase" and is a "purchaser" when he obtains title in any other mode than by descent or devolution of law. It was noted in Commissioner of Income Tax, Andhra Pradesh v. T.N. Aravinda Reddy (1979 (4) SCC 721 ) as follows: "The meaning of the word purchase in Section 54, Clause (i) of the Income Tax Act, 1961does not differ from its plain meaning which sense buying for a price equivalent of price by payment in kind or adjustment towards an old debt or for other monetary consideration. Each release in the circumstances of the given case is a transfer of the releasers share for valuation to the release. In plain English, the transferee purchases the share of each of his brothers. Thus Section 54, Clause (i) is attracted." 16. Normal meaning of the word purchase is acquisition for money or for any consideration. That is the primary meaning. In Concise Oxford Dictionary, apart from the two meanings "buy, acquire", another meaning given to the word "purchase" is "procure". The word "procure" consists of much wider import than the word "purchase". In the same dictionary, the word "procure" has been mentioned the meaning as "obtained by care or effort acquire". Purchase is thus a word of restricted meaning than the word "procure". While considering a taxing statute which deals with income from business the word "purchase" will therefore, have to be seen in the commercial sense. In the commercial sense, a transaction of purchase is a part of a transaction of sale. A transaction of sale can never be complete unless there is a transfer of property from the seller as well and the buyer who is the purchaser, must, therefore, acquire the property before he can claim to have purchased the property.17. In the Sale of goods Act and also in the Central Sales Tax Act or in any of the sales tax laws made in the several States, the definition includes the sale of goods, and not to the purchase of goods. That must be so because the sale of a commodity must include within its ambit the concept of sale as well as purchase. It is not possible to conceive of a sale of goods without a buyer.18. It is fairly accepted that SAP has been paid. The claim of the respondent is that determination is tentative and certain adjustments can be made later. But till that is done the SAP has to be taken as the consideration. In our view appellants were justified in demanding purchase tax on the amount paid as SAP and the High Courts view is clearly unsustainable and is set aside. The view expressed in Ponni Sugars case (supra) is in consonance with the view expressed by the Constitution Bench in U.P. Cooperatives case (supra). The observations relating to the agreed price which is above the lowest permissible rate cannot read to mean that any ceiling is fixed by the agreed price. In fact in Ponni Sugars case (supra) and U.P. Cooperatives case (supra) this Court held that the price fixed under the Control Order was the minimum price and it was the lowest permissible rate. The highest amongst the three prices relatable to the purchase is the price on the basis of which the purchase tax is to be levied.

### Response:
1

### Explanation:
It is the stand of the respondent that purchase price is not defined and, therefore, the agreed price would be taken to be the purchase price.This plea is clearlythe commercial sense, a transaction of purchase is a part of a transaction of sale. A transaction of sale can never be complete unless there is a transfer of property from the seller as well and the buyer who is the purchaser, must, therefore, acquire the property before he can claim to have purchased the property.17. In the Sale of goods Act and also in the Central Sales Tax Act or in any of the sales tax laws made in the several States, the definition includes the sale of goods, and not to the purchase of goods. That must be so because the sale of a commodity must include within its ambit the concept of sale as well as purchase. It is not possible to conceive of a sale of goods without a buyer.18. It is fairly accepted that SAP has been paid. The claim of the respondent is that determination is tentative and certain adjustments can be made later. But till that is done the SAP has to be taken as the consideration. In our view appellants were justified in demanding purchase tax on the amount paid as SAP and the High Courts view is clearly unsustainable and is set aside. The view expressed in Ponni Sugars case (supra) is in consonance with the view expressed by the Constitution Bench in U.P. Cooperatives case (supra). The observations relating to the agreed price which is above the lowest permissible rate cannot read to mean that any ceiling is fixed by the agreed price. In fact in Ponni Sugars case (supra) and U.P. Cooperatives case (supra) this Court held that the price fixed under the Control Order was the minimum price and it was the lowest permissible rate. The highest amongst the three prices relatable to the purchase is the price on the basis of which the purchase tax is to be levied.
