Title to goods test excludes commissioned carpet manufacture from sales tax liability under the U.P. Sales Tax Act.

Carpets manufactured to order were not treated as sales by the manufacturer where title never vested in the assessees at any stage and was not transferred by them to the purchasers. The decisive test under the U.P. Sales Tax Act was whether the assessees acquired and then passed title in the goods; on the facts found, they acted only as commission manufacturers and not as dealers in respect of those carpets. Accordingly, the transactions were held outside the scope of taxable sales, and the assessees were not liable to sales tax on them.

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Issues: Whether the assessees, who manufactured carpets to order, were dealers liable to sales tax under the U.P. Sales Tax Act.

Analysis: The determining test was whether title to the carpets ever vested in the assessees and was transferred by them to the purchasers. On the facts found, the assessees merely manufactured carpets on commission and, in respect of the carpets covered by the reference, the title never vested in them at any stage. Where there was no vesting and transfer of title by the assessees, the transactions could not be treated as sales by them for sales tax purposes.

Conclusion: The assessees were not dealers in respect of the carpets manufactured to order and were not liable to sales tax on those transactions.

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