TMI Blog1954 (1) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... le. He is a dealer in oil, coriander, pulses and other goods. He had a commission agent at Salem, through whom certain goods of his were sold. The turnover of such goods amounted to Rs. 35,881-2-3, and in respect of that, sales tax of Rs. 4,455-3-3 was paid by the commission agent. In respect of the same turnover the department levied sales tax from the assessee, that is the principal. The assessee contended that, as there was only one sale in respect of which the commission agent, who was treated as a "dealer", had paid sales tax, the levy of a tax a second time on the same turnover under Section 3 of the Madras Sales Tax Act was not justified in law. The contention, however, did not find favour with the department, but on appeal it was ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in Radhakrishna v. Province of Madras(1), that a commission agent is a dealer in respect of sale of goods belonging to his principal, for he has authority to pass the property in the goods which he had derived from the principal either expressly or by implication, having regard to accepted mercantile usuage. It therefore follows that the department, when it levied the tax on the commission agent at Salem, treated him as a dealer and treated the sale as having the effect of transferring the property in the goods to the buyer though the goods belonged to the principal and treated the turnover as the agent's turnover and levied the tax under Section 3 of the Act. It is not disputed before us that the tax was rightly levied on the commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, transfer of the property in the goods, and, there- fore, even though consideration for both is the same, in law they must be treated as different sales and tax should be levied under Section 3 of the Act in respect of each such sale. This, in our opinion, is not the correct view to take, having regard to the interpretation placed by the Full Bench on Section 8 of the Act, and having regard to the scheme under- lying the provisions of the Act. But for Section 8, it is true, as held by the Full Bench, an unlicensed commission agent, as in the present case, would be liable to pay sales tax on his turnover, even though he sold the goods belonging to his principal under the authority vested in him either expressly or impliedly to convey the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t which justifies or substantiates a claim: a ground of right; hence an alleged or recognised right." In short, the word "title" means, right to ownership of property, and property really includes and means the totality or the bundle of rights which constitute the ownership. Therefore, there is really no distinction between the passing of title and the passing of the property in the goods. When the property in the goods had passed, the title in the goods also passes. In whichever view the matter is looked at, it makes no difference, and it is impossible to spell out from the trans- action effected by the commission agent a two-fold sale, sale of the title by the principal and a sale of the property in the goods by the commis- sion agent. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a point and to that extent they stand in a position of active confidence towards their prin- cipals, but beyond that they are not agents in the real sense of the term and the relationship between the parties from then on is one of debtor and creditor." "..............The test to my mind is this: does the commission agent when he sells have authority to sell in his own name? Has he authority in his own right to pass a valid title? If he has then he is acting as a principal vis a vis the purchasers and not merely as an agent and there- fore from that point on he is a debtor of his erstwhile principal and not merely an agent." The dual relationship of debtor and creditor arises from the fact that according to the relationship between the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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