Commission agent turnover cannot be clubbed across principals where each principal stays below the taxable limit.

A commission agent acting for several resident principals could not be assessed on the combined turnover of all principals where each principal's turnover remained below the statutory minimum. The Act treated the agent as a machinery for assessment and collection, but liability under section 11 depended on the particular principal and the particular taxable transaction. As the tax recoverable from the agent was only the tax attributable to a principal who would otherwise be liable, clubbing the individual turnovers of separate principals was impermissible. The proposed assessment on aggregate turnover therefore could not stand.

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Issues: Whether a commission agent dealing for several resident principals can be assessed to sales tax on the aggregate turnover of all principals when the turnover of each principal is below the statutory minimum.

Analysis: The definition of dealer under the Act includes a commission agent carrying on business on behalf of any principal, and section 11 permits assessment of tax due in respect of a transaction effected by an agent only where the principal would otherwise be liable to pay such tax in respect of that transaction. The scheme of section 5, read with section 11 and the relevant rules, shows that liability is linked to the particular principal and the particular transaction, not to the agent's aggregate dealings for several principals. The agent is only a convenient machinery for assessment, levy and collection, and the proviso to section 11 confirms that the tax recoverable from the agent is the tax attributable to the principal whose transaction is taxable. Since each principal's turnover was below the non-taxable limit, the agent's total turnover for all principals could not be clubbed for assessment.

Conclusion: The commission agent was not liable to be assessed on the combined turnover of several principals whose individual turnovers were below the taxable limit, and the assessment proposed on that basis could not stand.

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