1964 (9) TMI 45

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....able to sales tax thereon. The contention of the department is that in respect of this sum, the assessees purchased goods for themselves and later on sold them. In the assessment proceedings they claimed exemption in respect of a sum of Rs. 45,562-86 as transactions representing selling agency transactions and a sum of Rs. 1,85,348.02 as representing buying agency transactions. The Deputy Commercial Tax Officer rejected the claim of the assessees in respect of both the items aforesaid but on appeal, the Commercial Tax Officer allowed the claim of the assessees and granted exemption in respect of Rs. 1,69,875-45 as representing buying agency transactions. The assessees' claim in respect of selling agency transactions was rejected by the Comm....

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....rtain buyers shown as buying agency transactions. The hearing of this appeal was adjourned for the department to produce the relevant vouchers, pattials, and receipts as well as relevant correspondence which passed between the assessees and the buyers to whom the goods were ultimately sold and delivered. On a a perusal of the correspondence we are satisfied that in all these transactions coming under the three categories, the assessees had been acting only as buying agents and they never purchased any portion of these goods in their own right with a view to sell them later on in the market. The Board of Revenue has taken one pattern of the transactions covered by the first category for discussion and from the documents it had come to the co....

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....ins of coconut oil from Messrs Sivakumar Oil Mills, Meyyanad, for ready despatch at Rs. 26-25 per ton of 37 lbs. net F.O.R. Quilon. We have given instructions to despatch the consignment and on receipt of the same shall clear and deliver to you ..... (Sd.) K. P. Sitharam & Company. I confirm the above transaction. (Sd.) P.S. Rathinasabapathy Chettiar, 12-4-1957." This letter also bears an endorsement to the effect that the transaction was confirmed by the purchaser on 12th April, 1957. From the foregoing correspondence, it will be clear that right from the beginning, the assessees have been acting only as buying agents, contracting the purchaser first and later on placing an order with the Kerala dealers, and then again ordering the goods ....

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.... the ultimate buyer, which confirmation was obtained later on, does not make the transaction any the less a buying agency transaction. As to the animus or the intention with which the assessees placed the order with the Kerala dealer, we have no doubt that they acted only as buying agents. One other circumstance which was relied on by the Board of Revenue in rejecting the claim of the assessees was that in some transactions the assessees had not only charged commission but also debited the customer with interest. We have perused the account books of the assessees and also all the pattials, bills and vouchers. We find that in some of the transactions such interest has been debited evidently because the assessees had cleared the goods borro....