TaxTMI 
TaxTMI 
1979 (10) TMI 203
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....2 and claimed exemption on the entire turnover on the ground that it acted only as an agent in dealing with the goods. The assessing officer did not accept this plea and finally determined the total and taxable turnovers at Rs. 4,34,283.92 and Rs. 1,28,767.53 respectively. The assessee appealed to the Appellate Assistant Commissioner and contended that it acted only as an agent of its members collectively, procuring their respective quota of allotment of dyes and art silk yarn required by them and that its transactions are not liable to tax. In this connection, it relied on a decision of this Court in National Chamber of Commerce v. State of Madras[1970] 25 S.T.C. 185. The Appellate Assistant Commissioner accepted these contentions and allo....
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.... to the Director of Handlooms could be submitted urgently. On 27th May, 1969, the assessee sent a list of the members and their requirements on the basis of actual consumption. 30.8 metric tonnes of hydros was released in or about September, 1969, for distribution to the handloom industry in Tamil Nadu. Out of the said quantity the assessee-association was allotted 350 kg. of hydros packed in 50 kg. drums. The value was Rs. 12 per kilogram plus 3 per cent Central sales tax with C form ex godown, Bombay. The State Trading Corporation was to intimate the amounts to be paid by the association towards the allotment. The allotment was made subject to the condition that it should be distributed only to the members in the presence of the Textil....
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....with all the requirements in the matter of the allotment of the chemical mentioned above. It is on the basis of these facts that we have to consider the liability of the assessee to sales tax. There are three aspects to be examined in this connection. The first is that the assessee has been incorporated as a limited company. The question is whether, as a consequence of incorporation, it is a separate entity independent of its members, so that it could be taxed on its dealings with the members. It has been held in cases arising under the parallel legislation, namely, the Income-tax Act, that, as a general rule, the fact that a mutual association is incorporated as a company would not affect its mutual character or does not destroy the com....
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....ssee-association was only acting as a go-between for its members in the sense it was concerned only with the distribution of the goods allotted to the members. It did not have, in the real sense, any property in the goods which it transferred in favour of the members. Before the Board, the assessee placed reliance on a decision of this Court in National Chamber of Commerce v. State of Madras[1970] 25 S.T.C. 185. In that case, the assessee was registered under the Societies Registration Act and it was also a dealer under the Madras General Sales Tax Act. It impored art silk, dyes and chemicals from abroad on the strength of the actual users' licences held by its members, and distributed them to the respective members and collected the sal....