Principal's sales tax liability through commission agent upheld where the agent had not already been assessed.

Under the Karnataka Sales Tax Act, a principal could be assessed on turnover routed through a commission agent because the statutory scheme treated the agent's liability as enabling and machinery-based, not exclusive. The definition of dealer covered a commission agent acting for a principal, and section 11 did not bar assessment of the principal unless the same turnover had already been assessed in the agent's hands. The proviso placed the burden on the principal to show prior assessment of the agent. The amendment to section 11 was treated as clarificatory, and because no assessment had been made against the commission agent for the relevant periods, the principal was held validly assessable.

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Issues: Whether, under the Karnataka Sales Tax Act, the principal could be assessed to sales tax on turnover effected through its commission agent, when the agent had collected the tax but no assessment had been made against the agent.

Analysis: The charging provision levied tax on the sale or purchase of goods and the definition of dealer included a commission agent carrying on business on behalf of a principal. Section 11 made the agent liable in respect of sales effected for a principal, but the proviso made it clear that the principal was not to be assessed again only where the agent had already been assessed and the burden of proving that fact lay on the principal. The statutory scheme therefore did not exclude assessment of the principal; rather, the liability of principal and agent was co-extensive. The amendment to section 11 was treated as clarificatory. The earlier decisions relied on had already held that section 11 was only an enabling or machinery provision and that there was no bar to assessment of the principal unless the same turnover had already been assessed in the hands of the agent. On the facts, no assessment had been made against the commission agent for the relevant periods.

Conclusion: The principal was validly assessable, and the challenge to the assessments failed.

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