KISHENLAL ROOPCHAND AND COMPANY Vs. GOVERNMENT OF MADRAS

JUDGEMENT

(1.) THE petitioners, Messrs Kishenlal Roopchand and Company, who are dealers in piece-goods at Madras, were assessed to sales tax in respect of their turnover for 1957-58. THE dispute relates to a portion of their turnover of Rs. 1, 50, 000. In the view of the department, these transactions represented sales effected in this State by a non-resident dealer of Ahmedabad by name Lalchand 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, 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.

(2.) THE first point to be determined is the nature of the transaction. THE Special Assistant Commercial 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 goods from the railway goods shed at Salt Cotaurs. THEre was evidence to show that the petitioners took these goods to their own premises in Madras City and subsequently they have delivered to the buyers. Out of 11 buyers involved in these transactions, three belonged to Madras, one to Pondicherry and the balance of seven to Kerala. THE Ahmedabad dealers could have booked to consignments direct to these buyers, but no satisfactory explanation was given by the assessees as to why the goods were booked instead, to Madras, and why the assessees took delivery of them and later on handed them over to the buyers. In the course of the enquiry by the department, a latter written by the Ahmedabad dealers on 4th January, 1958, to the assessees was filed and it reads :

(3.) IT was argued by the learned counsel for the petitioners, that the petitioners merely acted as clearing agents on behalf of the non-resident dealers, and that they did not represent them in their dealings with the buyers. IT was also urged that their obligations were confined to the duties described in the latter already extracted, dated 4th January, 1958, which indicated that they merely retained the goods after clearing they from the railway, pending further directions from the Ahmedabad dealers regarding their mode of disposal, and that it could not be inferred from this circumstances that they acted as the agents of the non-resident dealers in their sales. But even in the latter 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.