AI Drafter 
TaxTMI 
TaxTMI 
1964 (7) TMI 25
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....d Misrilal & Co., in which the Madras dealers, the assessees, were concerned as agents within the meaning of section 14-A of the Madras General Sales Tax Act of 1939 and consequently they were liable to be assessed on this part of the turnover. This view was confirmed by the Sales Tax Appellate Tribunal in the appeal, and the assessees have come before this Court in revision. The first point to be determined is the nature of the transaction. The Special Assistant Commissioner Tax Officer took extracts from the register of inward consignments at Salt Cotaurs Railway goods shed in Madras City and passed on these extracts to the assessing officer. It was found that the assessees had cleared 16 consignments of the non-resident dealers and go....
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...., therefore, to book the goods to Madras instead of to the buyers' destination. Certain letters written by Madras buyers were produced in the course of the enquiry and they showed that the Madras buyers used to place orders direct with the Ahmedabad dealers and they made payment direct to the Ahmedabad dealers. During the enquiry, besides supplying the above correspondence, the petitioners did very little to clear up the nature of their part in these transactions, whose details were entirely in their knowledge. They took the extreme stand that they had nothing to do with these transactions and that their name was misused in the railway records. They argued that they did not take delivery, but as against this, reference was made by the Tribu....
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....t dealers in their sales. But even in the letter already referred to, after directing the assessees to take delivery of the goods from the railway, the sellers asked them to keep the goods in their custody and deliver them pursuant to the subsequent directions to be issued by the Ahmedabad sellers. The petitioners have not cared to disclose the nature of these subsequent directions, whether they delivered the goods to the representative of the sellers when he came to Madras and left it to him to arrange for the delivery to the buyers, or whether the agents of the buyers themselves met the petitioners and took delivery of the goods after satisfying the assessees that they had remitted the price to the Ahmedabad dealers. In this connection on....
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....urnover in the State is less than the minimum prescribed under section 3, sub-section (3) of the Act. The Act after its amendment in 1959 included in the definition of "dealer" in section 2(g), a commission agent, or any other person who carries on a business of buying and selling the goods on behalf of the principal, but the Act of 1939 did not include a commission agent in the definition of the "dealer". But as laid down by a chain of decisions starting from Radhakrishna Rao v. Province of Madras[1952] 3 S.T.C. 121., it is implicit from general principles that a commission agent can validly effect sales and consequently will come within the definition of "dealer". Section 8 of the Act of 1939 gives an exemption from assessment to agents a....
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.... word must be understood to take the meaning accorded to it by section 182 of the Indian Contract Act, which defines an agent as a person employed to do any act for another or to represent another in dealings with third persons. The Supreme Court pointed out in the above decision, which interpreted section 18 of the Hyderabad General Sales Tax Act, 1950, which is in pari materia with section 14-A of the Madras General Sales Tax Act, 1939, that what was necessary to find out, was whether the assessee was employed by the non-resident dealer to do some act for or on his behalf or to represent him in his dealings with others. In the view of the Supreme Court there was nothing in section 18 of the Hyderabad Sales Tax Act (corresponding to sectio....
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....stances. As already pointed out in the present case, the facts justify the finding of the Tribunal that the petitioners were agents of the non-resident dealers within the scope of section 14-A. Another requirement of section 14-A is that it must be proved that the non-resident dealer is carrying on the business of buying and selling in this State. In the present case, out of the transactions of the non-resident dealers, only three are with buyers in Madras State, but the rest are with buyers in Pondicherry and Kerala State. But in all these cases, the bargain seems to be that the goods should be taken delivery of by the buyers in Madras City itself whether they are resident in Madras State or outside. The property in the goods passed in ....