Commission agent liability turns on strict statutory deeming conditions; consensual pooling and full accounting did not trigger sales tax.

A commission agent under the Mysore Sales Tax Act was taxable only if the deeming conditions in Explanation 3 to section 2(t) were satisfied. Mere deduction of genuine incidental expenses did not convert the agent into an ordinary dealer, because section 11 recognised such charges alongside commission. Where arecanuts of different principals were graded and pooled with the principals' consent before sale, the principals became joint principals for that transaction, and the agent's duty was to account for the full sale proceeds. In the absence of any statutory prohibition or failure to account, the consensual pooling did not attract sales tax liability or forfeit the benefit available to a commission agent.

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Issues: Whether a commission agent who, with the consent of the several growers, graded and pooled arecanuts belonging to different principals before sale at the market, thereby incurred liability to sales tax under the Mysore Sales Tax Act, 1957, and lost the benefit available to a commission agent.

Analysis: The relevant statutory scheme treated a commission agent as taxable only where the deeming conditions in Explanation 3 to section 2(t) were attracted. The petitioner's deduction of genuine incidental expenses did not by itself convert him into an ordinary dealer, because section 11 expressly recognised legitimate incidental charges in addition to agreed commission. As to the pooled sales, the goods were mixed only with the consent of the principals, who thus became joint principals for the purpose of the transaction. In that situation, the rate fetched for the pooled lot of a grade was the relevant rate, and there was no material to show that the agent sold at one rate and accounted at another, or that he failed to account for the entire collections. No provision was shown to prohibit such consensual pooling by a commission agent.

Conclusion: The petitioner did not fall within Explanation 3(b)(i) or Explanation 3(b)(iii) to section 2(t), and the sales tax levy was therefore unsustainable and illegal.

Ratio Decidendi: A commission agent does not incur sales-tax liability merely because, with the consent of the principals, he pools their goods before sale and fully accounts for the sale proceeds; the deeming provisions must be strictly confined to the conditions expressly stated in the statute.

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