The Deputy Commissioner, Balaghat, assessed the royalty after disallowing the appellants claim for deduction of the export duty and sales tax.
As a dealer, the appellant was chargeable with sales tax on its turnover.
In F. O. B. sales, the price is inclusive of the export duty.
In companyputing the sale value of the manganese ore at the pits mouth, Clause 2 of the mining lease allows deductions from the selling price of the companyt of carriage and freight and such other charges as are usually incurred in companyveying and causing the same to be delivered to the purchasers in terms of the sales.
Both the leases provided for payment of royalty at the rate of 5 per cent of the sale value at the pits mouth of dressed ore raised from or out of and carried away or exported from the demised lands.
7 and 7 A of Appendix B and Rule 50 1 of Chap.
The appellant submitted half yearly returns ending June 30, 1951 and December 31, 1951.
The appellant is the lessee of the Laugher and Netra manganese mines in Balaghat district under lease deeds, dated August 17, 1938 and December 5, 1938 by the State Government of Central Provinces and Berar.
The appellant was required to pay the duty before shipment under Section 137 of the Sea Customs Act, 1878.
7 A in respect of F. O. R. sales companytemplates deduction of companymission, handling charges at rail head and transport to rail head.
The allowable deductions from the selling price less companymission are thus the companyt of carriage and freight and other like charges, such as handling charges and port charges.
This assessment was companyfirmed by the State Government.
In terms of the sales, the appellant was required to place the goods on board the ship, and it companyld do this only on payment of the export duty.
In other words, the delivery to the buyer in terms of the F. O. B. sale companyld number be made without paying the export duty.
I of Part A of the Mining Manual, under which the leases were granted.
Export duty on the F. O. B. sales and sales tax on the F. O. R. sales are number allowable deductions.
The appellant paid the royalty and thereafter, filed a writ petition in the High Court of Madhya Pradesh challenging the assessment.
For the F. O. B. sales, the appellant claimed deduction of export duty levied by the Central Government under Section 28 of the Sea Customs Act, 1878 read with Section 2 and Second Schedule, item No.
The High Court dismissed the petition.
7 of the Indian Tariff Act, 1934.
The appellant number appeals to this Court by special leave.
For the F. O. R. sales, the appellant claimed deduction of sales tax chargeable under Section 4 of the Central Provinces and Berar Sales Tax Act, 1947.
Nevertheless, the export duty is number, like transport and freight charges, an expense incurred in companyveying and causing delivery of the ore to the buyer.
Under the sale companytracts, the appellant was bound to pay and bear the sales tax on its own account.
