Agency under sales tax law and writ maintainability against unauthorised levy despite alternative remedy

A middleman who never acquires title in coal and merely arranges delivery under a controlled supply regime is treated as an agent, not a principal seller, for the statutory definition of dealer; the coal supply itself is not a sale by that intermediary. The text also states that a writ can still be entertained against an allegedly unauthorised tax levy where the levy is challenged as lacking authority of law or infringing the right to carry on trade, despite an alternative remedy. Delay and acquiescence were treated as unpersuasive on the stated facts, and mere return disclosure was not enough to bar the challenge.

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Issues: (i) Whether the petitioner was a dealer or agent within section 2(f) of the Rajasthan Sales Tax Act, 1954, so as to be liable to sales tax on the coal transactions; (ii) Whether the High Court was justified in entertaining the writ petition despite the availability of an alternative remedy and the objections of delay and acquiescence.

Issue (i): Whether the petitioner was a dealer or agent within section 2(f) of the Rajasthan Sales Tax Act, 1954, so as to be liable to sales tax on the coal transactions.

Analysis: The agreement with the State, read with the Colliery Control Order, showed that the coal was supplied directly by the collieries to the Rajasthan Government power houses under allotment and sanction issued under the control regime. The petitioner did not acquire title in the coal, did not itself sell the coal, and merely procured the supply and collected the price. At the same time, the arrangement with the collieries entitled it to brokerage, so its role was that of an agent under the explanation to section 2(f), not a principal seller. The Court therefore treated the petitioner as an agent of the colliery company for the purpose of the statutory definition of dealer, but not as a seller in its own right.

Conclusion: The petitioner was an agent within the statutory explanation and was deemed a dealer for the Act, but the coal supply itself was not a sale by the petitioner.

Issue (ii): Whether the High Court was justified in entertaining the writ petition despite the availability of an alternative remedy and the objections of delay and acquiescence.

Analysis: Where a tax is challenged as lacking authority of law and as infringing the right to carry on trade, the existence of an appellate remedy does not bar writ relief. The delay was treated as satisfactorily explained by the uncontroverted factual material showing contemporaneous pursuit of departmental relief and a government resolution favouring exemption. Mere inclusion of the turnover in the return did not amount to acquiescence or estoppel against challenging an unlawful levy. The High Court, therefore, was right in overruling the preliminary objections.

Conclusion: The writ petition was maintainable and the objections of alternative remedy, delay and acquiescence failed.

Final Conclusion: The appeal succeeded, the matter was sent back for decision on the unanswered questions of situs of sale and inter-State trade, and the earlier relief granted by the High Court could not stand without further adjudication on those issues.

Ratio Decidendi: Under a statutory definition that includes persons carrying on business through an agent, a middleman who never acquires title and merely arranges delivery under a controlled supply regime is an agent rather than a principal seller; and a writ may lie against an allegedly unauthorised tax levy notwithstanding an alternative statutory remedy where the levy itself is challenged as unconstitutional or without authority.

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