First purchase levy under sales tax law cannot be applied to a commission agent receiving goods for sale.

Section 3-D of the U.P. Sales Tax Act applies the first-purchase levy only where the dealer is in fact a purchaser, and the deeming fiction in sub-section (7)(a) cannot be used against a commission agent who merely receives goods from principals for sale. The analysis notes that no prescribed proof requirement through rule 12-B and form III-C(2) existed until 4 March 1974, so goods received before that date could not be subjected to that later-form requirement. On that footing, the insistence on proving the principals' tax payment was unwarranted, and the remand on that basis was held to be unsustainable.

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Issues: Whether goods received by a commission agent from its principals prior to the prescribed date could be brought to tax as first purchases under section 3-D of the U.P. Sales Tax Act, 1948, and whether the dealer was required to furnish form III-C(2) or prove that the principals had paid purchase tax.

Analysis: Section 3-D levies tax on the first purchase of notified goods, and sub-section (7)(a) creates a deeming provision only where there is a purchase by the dealer. No prescribed mode of proof through rule 12-B and form III-C(2) existed until 4 March 1974. The goods in question had been received before that date, and the transaction was an admitted commission agency arrangement in which the dealer merely received goods from principals for sale. In such a case, where the dealer is not the purchaser, the deeming fiction of first purchase cannot be invoked, and there is no basis to require proof in the form insisted upon by the Tribunal.

Conclusion: The dealer was not liable to furnish form III-C(2) for goods received before 4 March 1974, and the Tribunal erred in remanding the matter on the footing that the principals' tax payment had to be proved.

Final Conclusion: The revision succeeded, the Tribunal's remand order was set aside, and the Commissioner's second appeal stood dismissed.

Ratio Decidendi: The deeming of a transaction as a first purchase under section 3-D applies only where the dealer is in fact a purchaser, and a commission agent receiving goods from principals for sale cannot be subjected to that fiction or to proof requirements that were not yet prescribed.

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