TMI Blog1971 (9) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... The question for decision by us lies within a narrow compass and that question is whether the assessee is entitled to claim exemption in respect of packing charges if his principal could have claimed it had it sold the cement itself. On that question, we agree with the view taken by the High Court. - Civil Appeal No. 2300 of 1968, W.P. No. 637 of 1967 - - - Dated:- 1-9-1971 - HEGDE K.S. AND GROVER A.N. JJ. S.T. Desai, Senior Advocate (B.P. Maheshwari, Advocate, with him), for the respondent. Bishan Narain, Senior Advocate (A.V. Rangam, Advocate, with him), for the appellant. -------------------------------------------------- The judgment of the court was delivered by HEGDE, J. -This appeal by certificate a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee claimed that it is entitled to deduct those charges from its total turnover in view of rule 6(c) of the Rules framed under the Madras General Sales Tax Act, 1959. The plea of the assessee that it was the agent of Dalmia Cement (Bharat) Ltd. during the relevant period was not denied in the return filed by the State of Tamil Nadu. It was also not denied that the assessee had shown the packing charges separately in the bills issued by it to the purchasers of cement. On the basis of those admitted facts the High Court came to the conclusion that the assessee is entitled to deduct from its total turnover the turnover relating to the packing charges if its principals would have been entitled to deduct the same had they sold the cement in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the price of the goods sold: (i) freight; and (ii) charges for packing, that is to say, cost of packing materials and cost of labour and other such like services." The first question that we have to consider is whether an agent of a principal who is also a dealer under; the Act is entitled to the same rights as his principal has under the Act. Under the general law the agent merely represents his principal. Therefore, while functioning within the scope of the agency he can exercise all the rights which his principal could have exercised. In fact, in the case of an ordinary agency, the agent merely acts for his principal. This provision must hold good even under the Madras General Sales Tax Act unless otherwise provided therein. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he question whether certain packing charges are exempt from tax, the authorities under the Act before deciding that question have to take into consideration the various aspects mentioned in that judgment. This is what the court observed therein: "In the instant case, it is not disputed that there were no express contracts of sale of the packing materials between the assessee and its customers. On the facts, could such contracts be inferred. The authority concerned should ask and answer the question whether the parties in the instant case, having regard to the circumstances of the case, intended to sell or buy the packing materials, or whether the subject-matter of the contracts of sale was only the cigarettes and that the packing material ..... X X X X Extracts X X X X X X X X Extracts X X X X
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