TMI Blog1985 (1) TMI 295X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment years 1979-80 and 1980-81 respectively. However, the assessing officer determined the taxable turnover for the said assessment years at Rs. 42,50,11,444.95 and Rs. 58,11,56,853.55 respectively. In regard to the said two assessments, the assessee disputed the turnover of Rs. 4,00,14,066 for the year 1979-80 and Rs. 18,12,15,180.69 for the year 1980-81. The said disputed turnovers represented the deliveries effected by the State Trading Corporation to the Civil Supplies Corporation, (sic) Kerala, of repressed oil for distribution in the States concerned, as per the directions of the Government of India, Ministry of Civil Supplies. According to the assessee, the said disputed turnovers represent the agency transaction and they do not re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is only one sale when the Civil Supplies Corporation sells the goods to the consumers through fair price shops or other agencies and that those sales have been taxed in the concerned States of Andhra Pradesh and Kerala. The revenue is questioning the said view taken by the Tribunal. 4.. On a due consideration of the matter we are satisfied that the Tribunal has come to the right conclusion. The original authority has chosen to treat the deliveries effected by the State Trading Corporation to the concerned Civil Supplies Corporations as amounting to sales merely because there has been prepayment towards the value of the goods by the Civil Supplies Corporation to the State Trading Corporation. We are not in a position to accept the said r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision on the terms of the agreement entered into between the State Trading Corporation and the Civil Supplies Corporations concerned. After referring to each one of the terms of the said agreement, the Tribunal has taken the view that the relationship between the State Trading Corporation and the concerned Civil Supplies Corporations is only that of an agency and not one of seller and purchaser as has been assumed by the revenue. It cannot be disputed that to find out whether there has been a sale between the State Trading Corporation and the Civil Supplies Corporations concerned, the terms of the agreement as between the two has to be taken to be relevant and material. For example, if we take the agreement between the State Trading Corp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding Corporation shall pay the agents an over-all charge of an amount to be decided by the State Trading Corporation of India Limited, Madras Branch, towards charges for transportation from Madras, Vizag, etc., ports and all other services in this behalf. The agents shall be responsible for observing all local regulations connected with facilities and of personnel employed by them for their obligations. A reading of the provisions of the agreement as a whole clearly shows that the Andhra Pradesh State Civil Supplies Corporation has been constituted as an agent and they are entitled to charge only for the services rendered by them. Since the title of the goods delivered to the Civil Supplies Corporation continues to vest with the State T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out that the true relationship of the parties in each case has to be gathered from the nature of the contract, its terms and conditions and the terminology used by the parties is not decisive of the legal relationship. As already pointed out, the agreement entered into between the parties clearly shows that the Civil Supplies Corporations in Andhra Pradesh and Kerala are constituted only as agents and they cannot be taken to be buyers of the goods for a price. The terms of the agreement make it clear that the goods are delivered by the State Trading Corporation to the Civil Supplies Corporations only in their capacity as distribution agents and there is no sale as between them. In this view of the matter, we do not think that any interfer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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