Turnover tax applies to commission sales by agents selling for registered principals under the Kerala sales tax framework.

A commission agent selling goods on behalf of registered principals is liable to turnover tax on the turnover of commission sales under section 5(2A) of the Kerala General Sales Tax Act, 1963. The Court followed the binding view that total turnover for turnover tax includes the purchase value of goods taxable at the point of last purchase when sold on commission basis for principals. It also noted that the later notification operated only prospectively and did not justify departure from the earlier precedent. The assessment was therefore sustained and the challenge failed.

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Issues: Whether a commission agent selling goods on behalf of registered principals is liable to turnover tax on the turnover of such commission sales under section 5(2A) of the Kerala General Sales Tax Act, 1963, including in the light of the relevant notifications.

Analysis: The assessee, a registered dealer dealing in hill produce and acting partly as commission agent, contested liability to turnover tax on commission sales. The assessment authority, appellate authority, and Tribunal rejected the contention. The Tribunal had already followed the Full Bench view that the total turnover for turnover tax includes the purchase value of goods taxable at the point of last purchase sold on commission basis on behalf of principals. The Court noted that the earlier division bench decision had considered the notification issue as well and had held that commission agents are liable to turnover tax on such goods. The subsequent notification was noticed only to the extent that it operated prospectively, and no ground was found to depart from the earlier binding view.

Conclusion: The commission agent is liable to turnover tax on the commission sales turnover, and the challenge to the assessment fails.

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