Commission agent sales under sales tax law remain taxable unless strict exemption conditions are proved and double taxation is avoided.

Sales effected through commission agents remain part of the dealer's total turnover under the Mysore Sales Tax Act, 1948, unless the statutory exemption conditions are strictly met. A licensed commission agent is exempt only where he acts for a known principal, the transaction is properly accounted for, and the sales are included in the principal's turnover as required by section 9 and its proviso. An unlicensed commission agent does not get that exemption and is treated as a dealer. The party claiming exemption bears the burden of proving the facts bringing the transaction within the statutory protection, and the same transaction cannot be taxed twice from both principal and agent.

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Issues: Whether sales effected through commission agents are taxable in the hands of the principal when the agent is licensed under section 9 of the Mysore Sales Tax Act, 1948, and whether sales made through an unlicensed commission agent can escape tax or subject both principal and agent to tax.

Analysis: Liability under section 3 attaches to every dealer on his total turnover, and a person carrying on sales through an employee or commission agent remains a dealer within section 2(d). A licensed commission agent gets exemption only if he sells on behalf of a known principal, the transaction is properly accounted for, and the sales are included in the principal's turnover as required by section 9 and its proviso. If the agent is unlicensed, no exemption is available and he is treated as a dealer. The burden remains on the dealer claiming exemption to prove the facts bringing the transaction within the exemption, and where tax is paid through one channel the same transaction cannot be taxed again from the other.

Conclusion: Sales through licensed commission agents remain taxable in the hands of the principal unless the statutory conditions for exemption are satisfied, and sales through unlicensed commission agents are taxable, but the same transaction cannot be subjected to tax twice from both principal and agent.

Ratio Decidendi: Under the Mysore Sales Tax Act, 1948, liability to sales tax turns on the status of the dealer and the statutory conditions for exemption, and a commission agent's licence protects only transactions that strictly satisfy section 9.

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