8. Section 206C is not
applicable to liquor vendors holding L-13 licences - K.K. Mittal & Co.
v. Union of India  203 ITR 201 (Punj. & Har.). Section 206C is
constitutionally valid - T.K.
Aboobacker v. Union of India  177 ITR 358
(Ker.)/A. Sanyasi Rao v. Government of AP  178 ITR 31 (AP)/Sat
Pal & Co. v. Excise & Taxation Commissioner  185 ITR
375 (Punj. & Har.). Where liquor licence is in the name of partner, but
firm was carrying on business, firm must be treated as a ‘seller’ - Bhagwan
Singh v. Union of India  209 ITR 824 (Pat.). State of Bihar will come within
the meaning of ‘seller’ - State of Bihar
v. CIT  202 ITR 535 (Pat.). Government distilleries must collect
tax at source on country liquor sold to licence holders - Rudra & Co.
v. Union of India  233 ITR 66 (HP). Lessees in Assam are excluded - Bikul Das v. State
 231 ITR 247 (Gauhati). Person having status of ‘individual’ in
income-tax proceedings is not permitted to collect tax under section
206C - Madan Mohan Gupta v. Union of India  204 ITR
384 (Pat.). Tax is to be collected on total amount of sale consideration and
not on sale proceeds - M.A. Majeed v. Divisional Forest Officer
 115 CTR (Ker.) 19. Collection is relatable to purchase price and not to
income component - Sat Pal & Co. v. Excise & Taxation
Commissioner  185 ITR 375 (Punj. & Har.). Excise duty element
should not be included in cost price - Ramjee Prasad Sahu v. Union of
1993 Tax LR 593 (Pat.)/Bharat Prasad Choudhary v. Union of India
 229 ITR 363 (Pat.)/Ashok Kumar v. Union of India  98 Taxman 32 (MP).
Purchase price includes excise duty - Circular No. 585, dated 27-11-1990. Purchase and sale of
tendu leaves after drying, etc., is not a ‘process’ and hence not exempt from
collection of tax at source - North Koel Kendu Leaves and Mahulam Leaves
v. Union of India  228 ITR 630 (Pat.)/Natwarlal v. Union
of India  233 ITR
490 (MP)/Sagarmal Agarwal v. Union of India  238 ITR 989 (Ori.). For details, see
Taxmann’s Master Guide to Income-tax Rules.