TMI Blog1960 (11) TMI 82X X X X Extracts X X X X X X X X Extracts X X X X ..... ecember, 1957, was as follows: "This is an appeal against a decision of the Collector of Sales Tax under section 27 of the Bombay Sales Tax Act, 1953, that the transaction of supply of coal by the appellants to one Nanalal Karsan- das of Ahmedabad was a sale and that the appellants are dealers liable to registration under the said Act. Under section 27 of the Act the Collector is to determine inter alia whether "any transaction is a sale or purchase". Thus a specific transaction has to be referred to the Collector for his decision. The appellants in their application were not sufficiently specific as regards this question, but gave a specific instance of a transaction which the Collector has investigated and of which he has determined the nature. In the circumstances of this case, we find it possible to hold that the appellants' application to the Collector did not suffer from any infirmity on account of the manner in which it was worded; no such infirmity has been pleaded by either party. 2.. Nanalal Karsandas had a brick factory for which he required 30 wagons of coal. The distribution of coal was controlled by the Ministry of Production of the Government of India under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ddleman commission" at the rate of Re. 1 per ton. The bills were duly paid. In their application the appellants admitted, "the financial liability of the payments rests on us". They submitted the following three questions for the Collector's determination: "(1) Whether they can be called dealers under the Bombay Sales Tax Act, 1953. (2) Whether as dealers they are liable for registration under the said Act. (3) Whether the supply of coal by the colliery to applicants and applicants to the consumer constituted two separate sales one by the colliery to the applicants and the other by the latter to the consumer or is a direct sale between the colliery and the consumer." All these questions were decided against them by the Collector. It was held by him that the most important feature of the transaction was that there had been no privity of contract between the colliery and Nanalal, and in his opinion the provisions of the Colliery Control Order, 1945, should not be taken "too literally". He relied on the long- standing practice whereby the consumers of coal in this State used to obtain coal through middlemen, a system not intended to be destroyed by the Colliery Control ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, the appellants have admitted their liability to pay to the colliery, apparently on an understanding between themselves and the colliery. In the case of Messrs United Coal Co. Since reported as The State of Bombay v. United Coal Co. [1958] 9 S.T.C. 19., it was held that the applicants were del credere agents for the colliery, and that this explained (1) why the bills were issued by the colliery to them and accounts written accordingly and (2) why the railway receipt was also sent to them. We observed in that case, "the provisions of the Colliery Control Order of 1945 appear to us to override other considerations, and it is clear that that order would not permit the applicants to sell coal to the Kathiawar Coal Distributing Co. as vendees...............Questions as to between which party there was privity of contract or in which party there was the right to sue will not, therefore, in the circumstances of this case, be determinative of the question before us." 4.. In the present case the appellants were undoubtedly the purchasing agents for Nanalal Karsandas. As they also undertook to pay the bill of the colliery which was sent to them, apparently under an existing arrange ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me Court of India under Article 136 of the Constitution of India. C.K. Daphtary, Solicitor-General of India, (H.R. Khanna and R.H. Dhebar, Advocates, with him), for the appellant. N.A. Palkhivala, Senior Advocate, (S.P. Mehta, Advocate and S.N. Andley, J.B. Dadachanji, Rameshwar Nath and P.L. Vohra, Advocates of Messrs Rajinder Narain Co., with him), for the respondents. JUDGMENT The Judgment of the Court was delivered by HIDAYATULLAH, J.- The State of Bombay has appealed to this Court with special leave, against an order of the Sales Tax Tribunal, Bombay, dated December 6, 1957, by which the Tribunal allowing the appeal before it, set aside an order of the Collector of Sales Tax passed under section 27 of the Bombay Sales Tax Act, 1953. The respondents, Ratilal Vadilal Bros., are commission agents doing business as clearing and transport contractors. On June 25, 1954, they applied to the Collector of Sales Tax, Bombay, under sections 27(a), (b) and (c) of the Act describing the nature of their business, citing one instance thereof, for determination of the question whether they could be called "dealers" within the Act. The Col ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, and required registration. "Dealer" in the Bombay Sales Tax Act, 1953, is defined as follows: "'dealer' means any person who carries on the business of selling goods in the State of Bombay, whether for commission, remuneration or otherwise..." (Explanation omitted). It would appear that to be a dealer, the person must carry on the business of selling goods in the State of Bombay. The short question in this case, therefore, was whether the respondents were carrying on such a business in respect of coal. The scheme of the Control Order shows that no sale of coal could take place except to a person holding a certificate. A sale otherwise was in contravention of the Control Order. The certificate which has been produced in the case, though made out in the name of the respondents, shows the consumer as the consignee. It is thus plain that there was no sale by the colliery to the respondents, but directly to Karsandas, though through the agency of the respondents. The respondents also, when they made out the bill to Karsandas, mentioned that he was the consignee, and that they were only charging their "middlemen" commission. In these circumstances, it is difficult to hold that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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