The Chowringhee Sales Bureaue case is considered as one of the landmark jusdgements in history of direct taxation and it will be trivial to pass the same as case specific. It is invariably quoted in all cases where the issue of turnover crops in specially disallowance u/s 43B, section 80I, 80IA, 80HHC etc. Referring to this decision it has invariably been held that receipts in the nature of sales tax, excise duty etc form part of total turnover or gross receipts.
As a matter of fact courts have been at great pains to dither from ratio of above decision in case of computation of deduction u/s 80HHC wherein it was held that sales tax will not be included in total turnover (Refer Sudarshan Chemicals Bombay High Court and other decisions) due to specific context in that section and not as general rule.
The ratio des dandi of chowringhee decision is not whether the sales tax receipt of auctioneer are trading receipt, it is actually what the court held as below:
It is the true nature and the quality of the receipt and not the head under which it is entered in the account books as 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 trading receipt.
So immaterial of the fact whether sales tax receipt is credited to sales accout or any other head (including balance sheet item), if the same is in nature of trading receipt (which normally the case is unless the sale consideration and sales tax is received on behalf of somebody else as agent), it will form part of gross turnover/ Gross Receipts.