9911796707
TMI Blog1995 (1) TMI 322X X X X Extracts X X X X X X X X Extracts X X X X ..... that the appropriation of the principal's goods by the assessee to himself, as represented by the debit entries in the 'Shah account', did not constitute a sale of goods at the hands of the assessee?" 2.. The assessee, M/s. Paragji Mulji & Co., is a partnership firm engaged in the business of buying and selling goods. It is also registered as a dealer under the Bombay Sales Tax Act, 1959. The assessee also acts as agent of principals to sell their products for a commission, the practice followed in this regard being that the principals send their goods to the assessee as their agent with instructions to sell the same. The assessee also carried on the business of selling similar goods of its own. So far as the goods belonging to the princip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n which sales tax was leviable. Against this revisional order, the assessee appealed to the Deputy Commissioner of Sales 'Fax who rejected the appeal and confirmed the order passed on revision by the Assistant Commissioner. The assessee thereafter filed revision applications before the Maharashtra Sales Tax Tribunal ("the Tribunal"). The contention of the assessee before the Tribunal was that the appropriation of the goods of the principals by the assessee, who was acting as their agent, could not be regarded as "sale" because a person cannot sell goods to himself. The case of the Revenue, on the other hand, was that the assessee was acting in a dual capacity and hence purchase of goods of the principals by him resulted in sale of goods. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... He was holding the goods in his capacity as an agent and was obliged to sell the same and to remit the proceeds thereof to the principal for which he was entitled to get a commission at the stipulated rate. There is no dispute also about the fact that the assessee was also dealing in similar goods belonging to himself. He was engaged in the purchase and sale of the same on his own account. As agent of the principal, he was entitled to sell the goods belonging to the principal and pass good title to the purchaser. Instead of selling the same to third parties, he purchased the goods himself by debiting the goods account (named "Shah account") in his books and crediting the account of the principal for the price of-the same. The moment this w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, express or implied. That, however, is a matter between the principal and the agent. In the case before us, there is no controversy about the fact that some of the goods of the principal were in fact purchased by the assessee himself for consideration and no objection was taken by the principal to such purchases. Under the circumstances, the inference is obvious that the assessee, who was an agent, had also been given the right to purchase the principal's goods himself. In such a case, it is difficult to hold that there was no sale within the meaning of section 2(28) of the Act. All the ingredients of the sale are present. The transaction was between two persons-one, the assessee in his individual capacity and the other, the principal rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o any purchaser. If instead of selling the goods to the outsiders, the agent sold the goods to himself by appropriating the goods owned by the principal and claiming commission by making entries in his books, there was a transfer of title from the principal represented by the agent to a dealer (the agent in his independent capacity). 8.. In view of the above, we are of the clear opinion that the Tribunal was not right in holding that the appropriation of the principal's goods by the agent to himself did not constitute sale of goods. In view of the above, we answer the question in the negative and in favour of the Revenue. In the facts and circumstances of the case, there shall be no order as to costs. Reference answered in the negative. X X X X Extracts X X X X X X X X Extracts X X X X
|
