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TMI Blog1958 (4) TMI 87X X X X Extracts X X X X X X X X Extracts X X X X ..... ention raised by the appellant and dismissed the petition. An appeal preferred against the order passed by Sinha, J., was dismissed by Chakravartti, C.J., and Lahiri, J. It is against this judgment that the appellant has come to this Court by special leave. The appellant is a registered dealer under the Act. As required by the Act, the appellant submitted his return for the year 1949-50 which showed that his turnover was Rs. 24,21,023-3-3. The appellant's case, however, was that the taxable turnover for the relevant period was 'nil'. He claimed that goods worth Rs. 1,79,733-0-0 were sold to registered dealers and were thus exempt from tax under section 5(2) (a)(ii) of the Act. In regard to the balance of goods worth Rs. 22,41,490-3-3, they had been despatched by the appellant or on his behalf to an address outside West Bengal and were thus exempt from tax under section 5(2)(a)(v) of the Act. In regard to the latter claim for exemption made by the appellant he alleged that, in his usual course of business and on the advices of Shah Narottamdas Harjivandas & Co., and two other well-known tea exporters and tea merchants of Bombay, he had purchased at the tea auctions i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt before the Assistant Commissioner but the appellate authority substantially agreed with the view taken by the Commercial Tax Officer and dis- missed the appeal. According to the appellant authority, whoever might have physically put the goods in the hold of the ships, the con- signors in the bills of lading, which were legal documents of despatch, must be deemed to be the despatchers. The appellate authority also held that it could not be disputed that the sales which occasioned the exports were the sales by the Bombay parties and as such there can be no question of the assessee's taking protection under Article 286(1)(b) of the Constitution. It was this order of the appellate authority that was challenged by the appellant in his petition filed before the High Court at Calcutta. Sinha, J., rejected the petition on two grounds. He held that the return filed by the appellant was the foundation of the present assessment proceedings and since the return had not been filed on the footing of an agent, the appellant's case that, in regard to the transactions in question, he was no more than an agent acting for his principals in Bombay cannot succeed. The learned Judge also foun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant in respect of the transactions in question solely by reference to the return, there could be no doubt that the appellant purports to be a dealer in respect of them and not an agent. It is really difficult to understand why the appellant should have included these transactions in his return at all if he had purchased the teas not for himself but as an agent on behalf of his Bombay principals. "Turnover" as defined by section 2(i) of the Act means "in relation to any period the aggregate of the sale prices or parts of sale prices receivable, or, if a dealer so elects, actually received by the dealer during such period" after making the permissible deductions; and a "dealer" under section 2, sub-section (c), means "a person who carries on the business of selling goods in West Bengal". It would thus be clear that unless the appellant had purchased the teas in question as a dealer he was not required to show these transactions in his return at all. The fact that those transactions were included in his return is consistent only with the theory that the appellant purchased the teas as a dealer within the meaning of the Act and is wholly inconsistent with his case that in these tran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 of the Constitution. But even on the merits we think the finding in question is perfectly correct. There can be no doubt that, with the unconditional appropriation of the goods to the contract by one of the parties with the consent of the other, property passes from the seller to the buyer. Shri Veda Vyas, however, relies on his conduct and suggests that until the goods were entrusted to the carrier title had not passed to the buyer. The goods were kept in the godown by the appellant. They were unpacked, blended by the appellant, repacked and duly marked before they were transported; and it is emphasized that for all these acts the appellant charged the Bombay parties and in substance included these charges in the price to be recovered from them. Prima facie this conduct may to some extent be in favour of the appellant's contention. But, on the other hand, the correspondence between the appellant and the Bombay parties clearly and unambiguously indicates that the property had passed to the Bombay parties long before the goods were ultimately despatched from Calcutta. In all the letters, the Bombay parties have consistently referred to the goods as their goods and have given sever ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he contract by the appellant with the consent, and to the knowledge, of the Bombay merchant, title to the goods clearly passed in favour of the Bombay party. Incidentally, the goods sent by the appellant were not the same as the goods originally purchased by him. There has been blending according to the instruction of the Bombay party and that also indicates that the sale of the goods by the appellant to the Bombay party had preceded the blending of several teas which was done under the instructions of the Bombay party on the basis that the title in the goods had already passed to the Bombay party. In that view of the matter section 5(2)(a)(v) of the Act would be wholly inapplicable. Then, as a last resort, Shri Veda Vyas invoked the provisions of Article 286(1)(b) of the Constitution. He urged that the transaction in question had taken place in the course of the export of the goods out of the territory of India and as such it cannot be taxed. The scope and effect of the provisions of Article 286(1)(b) has been considered by this Court on several occasions and it can be stated without any difficulty that in the light of the decision of this Court the appellant would not be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated and the sale and result- ant export form parts of a single transaction". The expression "a series of integrated activities", used by the learned Chief Justice in this judgment was subsequently explained by him when he delivered the majority judgment in the next Travancore case in The State of Travancore-Cochin and Others v. Shanmuga Vilas Cashew-Nut Factory and Others [1954] S.C.R. 53; 4 S.T.C. 205. The phrase "integrated activities", observed the learned Chief Justice, "had been used in the previous decision to denote that 'such a sale' (that is to say a sale which occasions the export) cannot be dissociated from the export without which it cannot be effectuated and the sale and the resultant export form part of a single transaction. It is in that sense that the two activities, the sale and the export, were said to be integrated". The conclusions which flow from the majority judgment in this case have been thus summed up by the learned Chief Justice: "(1) Sales by export and purchases by import fall within the exemption under Article 286(1)(b). This was held in the previous decision. (2) Purchases in the State by the exporter for the purpose of export as well ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayment from the exporters. The facts in the present case, however, are entirely different. Similarly, in the case of Gandhi Sons, Ltd. v. The State of Madras [1955] 6 S.T.C. 694., the Madras High Court had held that the property in question did not pass to the buyers until the relevant bills of lading were presented to the buyers or, in any event, at least not until the goods were put on board the vessel at Cochin harbour. In this case again the facts found are very different from the facts before us. We wish to point out that we do not propose to consider the correctness of the conclusions reached by the learned Judges in both these decisions. For the purpose of the present appeal it is enough to state that these cases, even if they are assumed to be correctly decided, do not support the appellant's contention. In the result the appeal fails and must be dismissed with costs. Before we part with this appeal, we may refer to one point which has been mentioned by Chakravartti, C.J., in his judgment under appeal. The learned Chief Justice has observed that the appellant had not fully availed himself of the remedies open under the Act. In fact he had preferred an appeal against ..... X X X X Extracts X X X X X X X X Extracts X X X X
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