Agency in non-resident sales business and proof of turnover inclusion governed tax liability and exemption under the Act.

An agent need not have authority to conclude purchases to attract section 18 of the Travancore-Cochin General Sales Tax Act, 1125, if the evidence shows he was otherwise concerned in the non-resident principal's business; acts such as transmitting offers, financing buyers, settling accounts, retaining goods and arranging drying, packing and transport were treated as sufficient participation. Exemption under section 9 required more than a licence and vouchers: the licensee had to prove that the sale proceeds were actually included in the principals' turnover, or would have been included but for an applicable exemption. On that basis, section 18 applied, but exemption under section 9 was not proved.

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Issues: (i) Whether the petitioner was an agent of the non-resident buyers with authority to buy, or at least an agent concerned in their business so as to attract section 18 of the Travancore-Cochin General Sales Tax Act, 1125; (ii) Whether the petitioner was entitled to exemption from tax under section 9 of the Travancore-Cochin General Sales Tax Act, 1125 for the transactions put through during the period ending 30 September 1955.

Issue (i): Whether the petitioner was an agent of the non-resident buyers with authority to buy, or at least an agent concerned in their business so as to attract section 18 of the Travancore-Cochin General Sales Tax Act, 1125.

Analysis: The memos signed by buyers after the purchases were completed were treated as inconclusive on the question of authority to buy. On the evidence of the market practice, the petitioner acted as the medium through whom offers and counter-offers were transmitted, financed buyers in some cases, settled accounts with sellers, remained in custody of the goods after purchase, and arranged drying, packing and transport. These acts showed participation in the business of the non-resident buyers, even though they did not establish authority to strike the bargain on their behalf.

Conclusion: The petitioner was not proved to be an agent with authority to buy, but he was an agent concerned in the business of the non-resident buyers, and section 18 applied.

Issue (ii): Whether the petitioner was entitled to exemption from tax under section 9 of the Travancore-Cochin General Sales Tax Act, 1125 for the transactions put through during the period ending 30 September 1955.

Analysis: Exemption under section 9 depended not merely on the existence of a licence and proper vouchers, but on proof that the sale amounts were actually included in the principals' turnover, or would have been included but for an applicable exemption. The burden of proving compliance with the proviso rested on the licensee. Mere vouchers and the Adakkapattika books were insufficient without evidence that the principals had in fact brought the amounts into their turnover in assessment proceedings or in their books of account.

Conclusion: The petitioner failed to prove entitlement to exemption under section 9.

Final Conclusion: The revision petitions succeeded only to the extent that the Tribunal's remand on exemption was set aside, and the appellate order restoring the assessment position was upheld.

Ratio Decidendi: For section 18, an agent need not have authority to buy if he is otherwise concerned in the non-resident principal's business; for section 9, exemption is available only when the licensee proves that the sale proceeds were actually included in the principal's turnover.

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