TaxTMI 
TaxTMI 
1991 (7) TMI 296
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....74, it claimed exemption on the basis of sales in respect of imports under local and Central Acts. The Sales Tax Officer narrated the facts in his order as under: "The dealer has claimed exemption on the basis of sales in respect of imports under local and Central Acts. While examining the claim of the dealer it was revealed that the dealer had received authorisation of State Trading Corporation from various parties during the period under assessment for procuring goods on their behalf. These transactions fall in two categories: (1) sales for which the dealer received authorisation of State Trading Corporation for procuring goods on behalf of various parties and for which sale bills have been raised directly by the State Trading Corpo....
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....ate Trading Corporation." The Sales Tax Officer did not accept the contention of the dealer that the transactions were not its sales or that it simply acted as agent of the other purchasing dealers. The said transactions were subjected to sales tax in the hands of the dealer. An appeal was filed against the orders passed both under the local Act and the Central Act but the Additional Commissioner of Sales Tax dismissed the same. The dealer then filed two appeals before the Tribunal. After examining the various documents on the record, the Tribunal concluded that the dealer had no power or authority to sell imported newsprint except to the holder of actual user licence. It came to the conclusion that the dealer had acted only as an ....
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....ual user licensees. We propose to deal with these two categories of cases separately though the result is the same. As regards the imports worth Rs. 10,88,141, the Tribunal has found that import licences were issued by the Chief Controller of Imports and Exports in the name of actual users. Under the provisions of the Import and Export Control Order, letter of authority used to be issued whereby the dealer was authorised to import goods on behalf of the licensees. The letter of authority entitled the dealer to open letter of credit and make remittance of foreign exchange. The letter of authority was issued subject to three conditions which were: "A. The person or concern in whose favour it has been issued, will act purely as an agent ....
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....rted for the licensee and it is the licence- holder who was to have the title in the goods both at the time of clearance through the customs and subsequent thereto. The goods were imported by the dealer no doubt but they were imported on behalf of the licensees. As the goods remained the property of the licensees, the question of the same being sold by the dealer could not arise. The dealer never became the owner of those goods. The ownership was transferred by the foreign seller to the licensees. There was no principal to principal contract of sale between the dealer and the licensees. As the goods belonged to the licensees, there could obviously be no question of the dealer selling those very goods to the licensees. The only role which....
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....ansactions, we find the position not to be radically different. Newsprint became a canalised item. The canalised agent was the State Trading Corporation. Actual users had to get themselves registered and obtain authorisation and thereafter actual user licences used to be issued by the Chief Controller of Imports and Exports in favour of the actual users. On the basis of the licences so issued, order is to be placed on the State Trading Corporation, who would, thereafter import the goods from abroad. In fact the import licence which used to be issued was subject to the conditions which were attached to the licence itself. The most important condition was that the goods were being imported from abroad by the State Trading Corporation and t....