Commission agent not a dealer where he only brokers face-to-face sales and does not buy or sell for principals.

A commission agent is treated as a dealer under section 2(c) of the U. P. Sales Tax Act only when he carries on the business of buying or selling goods on behalf of principals. A mere intermediary who brings buyers and sellers together, facilitates a face-to-face sale, and issues purchase memos does not fall within that definition. The decisive factors were that the sellers brought the goods themselves, the price was settled by them, the sales were completed in their presence, and property in the goods did not pass to the assessee. On those facts, the transactions were brokerage, not dealer activity, and the issue was answered against the department.

---

---

Issues: Whether a commission agent who merely brings buyers and sellers together, issues purchase memos, and facilitates sales completed in the presence of both parties is a dealer within the meaning of section 2(c) of the U. P. Sales Tax Act.

Analysis: The explanation to section 2(c) treated a broker or commission agent as a dealer only if he carried on the business of buying or selling goods on behalf of his principals. A mere broker who acts as an intermediary and brings the parties together does not fall within that definition. No single circumstance, including the issuance of purchase memos in the names of both buyer and seller, is determinative. The controlling factors were that the goods were brought by the sellers themselves, the sales were completed in their presence, the price was settled by them, and the property in the goods did not pass to the assessee in those transactions. Such features showed brokerage and not buying or selling on behalf of principals.

Conclusion: The assessee was not a dealer in respect of the transactions completed face to face between the buyers and sellers on the same day or the next day with the sellers' approval; the question was answered against the department and in favour of the assessee.

Ratio Decidendi: A commission agent is a dealer only where he carries on the business of buying or selling goods on behalf of his principals; a mere intermediary who brings the parties together and facilitates a face-to-face sale is not a dealer, even if purchase memos are issued in the course of the transaction.

---