SINGARAJANAHALLI KRISTA REDDI Vs. STATE OF MADRAS

JUDGEMENT

(1.) THE plaintiff is the appellant. On 18th June, 1949, the State Government collected from him a sum of Rs. 1, 409 which they claimed he was bound to pay as sales tax in respect of the year 1944-45. On 28th July, 1950, that is to say, more than six months after the date of payment, the plaintiff brought the action, out of which the present second appeal arises, for the recovery of this sum of Rs. 1, 409 which he had been forced to pay, together with interest thereon and costs.

(2.) THE case set out in the plaint was this. THE plaintiff is only a commission merchant, his business consisting in selling goods which ryots took to him for sale and which he sold on their behalf. THE plaintiff was at no time the owner of the goods ownership always continued in the ryots till the goods were sold to the merchants or other purchasers. THE plaint avers : "THE plaintiff being a commission agent, has no title of his own and he simply transfers the title of his principal." He was not therefore liable to pay tax under Section 3 of the Madras General Sales Tax Act. For this trouble he used to be paid a commission both by the ryots and by the purchasers from the ryots. In addition to this commission he also used to collect customary charges like dharmam etc.

(3.) PRESUMABLY in view of that decision the plaint was drafted on the basis that the plaintiff was only a commission agent. But, by the time the suit became ripe for trial, a Full Bench of this Court had given the decision reported in Radhakrishna v. Province of Madras There it was held that though a broker is only a person who is employed to make a bargain for another, and who receives a commission on the transaction and cannot be called a dealer, yet a commission agent who has custody or possession of the goods and who has authority from the owner of the goods to pass the property in and title to them is a dealer within the meaning of the Act, and, therefore, liable to pay sales tax. In view of that decision the oral evidence in this case proceeded on the basis not that the plaintiff was a commission agent as he had pleaded in his plaint, but that he was a broker. It appears to us that the evidence was designed to suit the decision in the Full Bench case and cannot be accepted. Further the evidence of P.Ws. 1 and 2 is not sufficient to establish the true nature or course of the plaintiff's business. The general statements they made are of little worth. Specifically P.W. 1 spoke only of a single transaction.