Judgment G.C.Bharuka, J. 1. In this reference under Sec. 256(2) of the Income-tax Act, 1961 (hereinafter "the Act" only), opinion needs to he rendered in respect of the following question : "Whether, on the facts and in the circumstances of the case, the sum of Rs. 1,50,993 in respect of the assessment year 1972-73 represented trading receipts and was liable to be included in the total income ?" The business of the assessee consisted of dealing in Kirloskar and Cummins products. The manufacturers, who are stationed at Bombay and Poona, had despatched the goods for various destinations in the State of Bihar raising bills against the assessee which included Central Sales Tax (in short, "C. S. T.") at the rate of four per cent. During the course of movement of the said goods, a second sale was effected by the assessee by transfer of document of title. While realising the sale price of the said goods, the assessee reimbursed itself by charging the said four per cent. Central sales tax from its customers. Curiously, though the assessee claimed the Central sales tax paid by him to the manufacturers as trading expenses by debiting it to the purchase account, the amount received by him by way of Central sales tax was not shown as a trading receipt by crediting it in the sales account. Instead, the amount so realised which was quantified at Rs. 1,50,993 was credited in an account described as "exempted sales tax account". Thus this amount was not allowed to participate in the computation of the profits of the year in question. The Income-tax Officer rejected the claim of the assessee and has added this amount to the income treating the same to be a trading receipt. The Appellate Assistant Commissioner also took the same view. But the Tribunal has taken the view that till the sales tax authority accepts the claim of exemption put forward by the assessee by passing an appropriate assessment order, the liability of the assessee towards the Central sales tax continues and the same can be brought to tax only in the year in which the plea of exemption is accepted on the basis of statutory declarations. 2. 2. Learned standing counsel for the Income-tax Department and Shri K.N. Jain, learned senior counsel appearing for the assessee, have taken us through various provisions of the Central Sales Tax Act, 1956 (hereinafter "the C. S. T. Act" only), and have made detailed submissions by citing various authorities, in support of the rival contentions, with which I will be dealing hereinafter. 3. Since the provisions of the Central Sales Tax Act will have some bearing" on the question involved, it is necessary to refer to some of its provisions. 4. Sec. 3 of the said Act provides that "a sale or purchase of goods shall be deemed to take place in the course of inter-State trade or commerce if the sale or purchase --(a) occasions the movement of goods from one State to another, or, (b) is effected by a transfer of documents of title to the goods during their movement from one State to another. Sub-section (1) of Sec. 6 makes every dealer liable to pay tax under this Act on all sales effected by him in the course of inter-State trade or commerce. Sub-sec. (2) of Sec. 6, inter alia, provides that any subsequent sale during the movement of goods effected by a transfer of documents of title to such goods to a registered dealer of specified description shall be exempted from tax under the Central Sales Tax Act, but the proviso to this Sub-sec. provides that such exemption cannot be availed of unless the dealer effecting the sales furnishes certain statutory declarations to be issued by the selling and purchasing dealers in the forms prescribed under the Rules which have been designated as Form C and "E-I/E-II". Therefore, the scheme under the Act is that in the course of movement of goods from one State to another even if a series of sales take place, the liability to pay Central sales tax will arise only once in the hands of the first seller. The dealers effecting the subsequent sales have been exempted from any further liability provided they fulfil the statutory formalities. In such cases, under the statutory scheme, no discretion has been vested in the authorities to deny the exemption, provided the formalities are completed. Therefore, the claim of exemption will fall or stand on the act of the dealer or its contracting parties and not because of any discretion vested in the statutory authorities. In such cases, under the statutory scheme, no discretion has been vested in the authorities to deny the exemption, provided the formalities are completed. Therefore, the claim of exemption will fall or stand on the act of the dealer or its contracting parties and not because of any discretion vested in the statutory authorities. Accordingly, no dispute can be said to exist respecting the liability because the exemption flows from the mandate of the Legislature. 5. Coming to the facts of the present case, in my opinion, there cannot be any doubt that the amount realised by the petitioner by way of Central sales tax from its customers was a part of the sale price and as such it was a trading receipt. The act of the assessee in opening an "exempted sales tax account" and crediting the said amount to this account may be at best for the convenience for the assessee but for the purpose of computation of taxable income the creation of such accounts is of no consequence. In the case of Chowringhee Sales Bureau P. Ltd. V/s. CIT [1973] 87 ITR 542, it has been held by the Supreme Court that : "It is apparent from the order of the Appellate Assistant Commissioner and has not been disputed before us in the present case that in the cash memos issued by the appellant to the purchasers in the auction sale it was the appellant who was shown as the seller. The amount realised by the appellant from the purchasers included sales tax. The appellant, however, did not pay the amount of sales tax to the actual owner of the goods auctioned because the statutory, liability for the payment of that sales tax was that of the appellant. The appellant-company did not also deposit the amount realised by it as sales tax in the State exchequer because it took the position that the statutory provision creating that liability upon it was not valid. As the amount of sales tax was received by the appellant in its character as an auctioneer, the amount, in our view, should be held to form part of its trading or business receipt. The appellant would, of course, be entitled to claim deduction of the amount as and when it pays it to the State Government. As the amount of sales tax was received by the appellant in its character as an auctioneer, the amount, in our view, should be held to form part of its trading or business receipt. The appellant would, of course, be entitled to claim deduction of the amount as and when it pays it to the State Government. The fact that the appellant credited the amount received as sales tax under the head Sales tax collection account would not, in our opinion, make any material difference. It is the true nature and the quality of the receipt and not the head under which it is entered in the account books which would prove decisive. If a receipt is a trading receipt, the fact that it is not so shown in the account books of the assessee would not prevent the assessing authority from treating it as a trading receipt. We may in this context refer to the case of Punjab Distilling Industries Ltd. V/s. CIT [1959] 35 ITR 519 (SC). In that case certain amounts received by the assessee were described as security deposits. This court found that those amounts were an integral part of the commercial transaction of the sale of liquor and were the assessees trading receipt. In dealing with the contention that those amounts were entered in a separate ledger termed empty bottles return security deposit account, this court observed : So the amount which was called security deposit was actually a part of the consideration for the sale and, therefore, part of the price of what was sold. Nor does it make any difference that the price of the bottles was entered in the general trading account while the so-called deposit was entered in a separate ledger termed "empty bottles return deposit account" for, what was a consideration for the sale cannot cease to be so by being written up in the books in a particular manner." The same view has been reiterated in the case of Sinclair Murray and Co. P. Ltd. V/s. CIT, 1974 97 ITR 615 . 6 In support of his submission, Mr. Jain strongly placed reliance on a subsequent Supreme Court judgment in the case of CIT V/s. Hindustan Housing and Land Development Trust Ltd. [1986] 161 ITR 524. P. Ltd. V/s. CIT, 1974 97 ITR 615 . 6 In support of his submission, Mr. Jain strongly placed reliance on a subsequent Supreme Court judgment in the case of CIT V/s. Hindustan Housing and Land Development Trust Ltd. [1986] 161 ITR 524. In this case the dispute was as to whether the amount of compensation payable to the assessee pursuant to compulsory acquisition under the provisions of the Requisitioned Land (Continuance of Powers) Act, 1947, which was still in dispute with the appellate authority can be said to have accrued as income to the assessee in the year it was awarded. Negativing the contention of the Department, the Supreme Court took the view that there is a clear distinction between cases where the right to receive payment is in dispute and it is not a question of merely quantifying the amount to be received, and cases where the right to receive payment is admitted and the quantification only of the amount payable is left to be determined in accordance with settled or accepted principles. In my opinion, this case cannot be said to have any direct bearing or relevance to the question involved in the present case. Rather, the question referred is directly covered by the principles laid down by the Supreme Court in Chowringhee Sales Bureau P. Ltd.s case [1973] 87 ITR 542, where their Lordships have held that the amount of sales tax received should be held to form part of the assessees trading or business receipts and he will be entitled to claim deduction of the amount as and when he pays it to the State Government. 7. For the aforesaid reasons, I am of the considered opinion that the sum of Rs. 1,50,993 represented trading receipts of the assessee during the assessment year in question and was thus liable to be included in the total income. There will be no order as to costs. 8. Let a copy of this order be sent to the Income-tax Appellate Tribunal, Patna Bench, for giving effect as required under Sec. 260 of the Act. 9. S.K. Chattopadhyaya, J.I agree.