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TMI Blog1963 (11) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... revision petitions made to it under section 15-B(1) of the General Sales Tax Act (Kerala) (Act 11 of 1125 M.E.). These revision petitions related respectively to the assessment orders for the years 1953-54, 1954-55 and 1957-58. The respondent, a firm of traders, claimed in the assessment to sales tax for the aforesaid years exemption of certain sales of kerosene by it under a licence granted under section 9 of the Act. That claim gave rise to these appeals. Section 9 so far as relevant is in these terms: "Government may on application...........license any person under this section who for an agreed commission...........sells on behalf of known principals specified in his accounts in respect of each transaction and may exempt from the ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oved the High Court of Kerala by the aforesaid revision petitions. It raised the following three questions for the decision of the High Court: "(1) Whether on a true construction of the agreement dated 1-6-1952 between the assessee and Caltex (India) Limited, the kerosene supplied by Caltex (India) Ltd., to and sold by the petitioner was as purchaser or as commission agents. (2) Whether the respondent is precluded from levying and collecting sales tax on the disputed turnover on account of the fact that a licence under section 9 of the Sales Tax Act was granted to the petitioners. (3) Is the order of the Sales Tax Appellate Tribunal, Kerala, Trivandrum, in the above matter sustainable in view of the failure of the Tribunal to decide qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing on the agencies in respect of them would not be fatal to their being treated as agents and in that view of the matter came to the conclusion that the respondent was an agent. It, therefore, remanded the case to the Appellate Tribunal to determine the terms of the licence and whether the respondent had sold the kerosene in accordance with the terms of the licence. In this appeal counsel for both sides canvassed the question of the construction of the agreement. Learned counsel for the State said that the agreement was really one of sale of the kerosene by Caltex (India) Ltd. to the respondent while learned counsel for the respondent con- tended that the proper interpretation of the agreement was that it constituted the respondent the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (India) Ltd., could not sell on behalf of it as its principal and specify it as the principal in its account as required by section 9 for clause 8 of the agreement prevented it from doing so. That clause is in these terms: "The distributors shall not have any right or authority to and shall not incur any debts or liability or enter into any contracts or transact any business whatsoever in the name of or for or on behalf of the company, and shall not represent himself in any way to be, the agent of the company." Under this clause the respondent could not sell expressly on behalf of Caltex (India) Ltd., nor could it enter in its account the sales as such. Under section 9 the sale would have to be on behalf of known principals, that is, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the contention that it contains a pious declaration. It is an operative part of the contract; it is one of the bargains made and is capable of enforcement, if necessary. In this view of the matter we think that the appeals must be allowed. We think it right to point out that this aspect of the matter had not struck anyone in the High Court or at any earlier stage. In our view, for the reasons earlier mentioned, this is decisive of the case. We however also think it right to point out that though we are setting aside the judgment of the High Court we express no opinion on the interpretation of the agreement of June 1, 1952, or as to the correctness of the view taken by the High Court. We find it enough to proceed on the assumption that th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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