Agent's sales tax liability is coextensive with the principal's where the principal is not a dealer.

Sales tax liability under the Karnataka Sales Tax Act depended on whether the assessee was a dealer. The statutory definition did not include the State Government on the facts, and section 19 treated the Government, when selling goods, as entitled only to collect amounts equivalent to tax recoverable by a registered dealer rather than as a dealer itself. Because an agent's liability is coextensive with that of the principal, the State Government's agent could not face a greater liability than the principal where the principal was not liable to tax on the relevant turnover. The respondent was therefore not liable to sales tax for the relevant period.

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Issues: Whether the respondent, acting as agent of the State Government in procurement and sale of foodgrains, was liable to sales tax under the Karnataka Sales Tax Act, 1957.

Analysis: Liability under the charging provision arose only if the assessee was a dealer. The statutory definition of dealer did not include the State Government in the circumstances of the case, and section 19 indicated that the State Government, when selling goods, was entitled only to collect amounts equivalent to tax collectable by a registered dealer, not to be treated as a dealer itself. Since the State Government was not liable to tax on the relevant turnover, its agent could not be subjected to a greater liability than the principal, as the agent's liability was coextensive with that of the principal.

Conclusion: The respondent was not liable to be assessed to sales tax for the relevant period and the revision failed.

Ratio Decidendi: An agent cannot be assessed to sales tax where the principal is not a dealer and is not liable to tax, because the agent's tax liability is coextensive with that of the principal.

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