1976 (8) TMI 138 - HC - VAT and Sales Tax

Summary

Issues:
Whether the assessee could be held as a dealer under the U.P. Sales Tax Act based on the facts found.

Analysis:
The judgment of the Court addressed the issue of whether the assessee could be classified as a dealer under the U.P. Sales Tax Act. The definition of "dealer" under the Act encompasses individuals engaged in buying or selling goods. The Court emphasized that to be considered a dealer, one must conduct the business of buying and selling. The assessment order revealed that the assessee stocked goods, made payments after transactions, and operated from premises where business activities took place. These factors led to the conclusion that the assessee was engaged in buying and selling, rather than acting solely as a weighman or broker.

The Court rejected the argument that the mere issuance of parcha leval by the assessee did not establish dealer status. It was highlighted that while issuing parchas may not conclusively determine dealer status, if circumstances indicate that the assessee had the authority to transfer title to goods, they would be liable for tax under the Sales Tax Act. The Court also referenced a previous case where the assessee was deemed a dealer when advances were made by pledging stock with a bank. This further supported the finding that the assessee in this case was engaged in buying and selling activities.

Regarding the scope of the reference, the Court clarified that the question of law must arise from the revising authority's order, including judgments from the appellate court and assessing authority. The Judge (Revisions) affirmed the findings of the lower courts, indicating that a detailed finding on every aspect of the case was not necessary. The Court cited a previous decision where the question of law was answered based on findings from the appellate court, reinforcing the approach taken in this case.

Ultimately, the Court answered the reference question affirmatively, stating that based on the facts found, the assessee qualified as a dealer under the U.P. Sales Tax Act. The judgment favored the department, directing the parties to bear their own costs in the reference.