1956 (2) TMI 42

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..... rned to the appellants, wherein the charge is made or shown "less discount 15 per cent." They receive a similar discount from the newspaper or other journals and recover the amounts of the bills, without showing the discounts received by them, from their clients. In this case we are concerned with the subject of the blocks which are got prepared and utilised by the newspapers or other journals concerned. The view taken by the authorities below is that the blocks are actually purchased by the appellants and again sold to their clients and that on such sales the sales tax can legitimately be charged, and the tax has been charged accordingly. In support of those orders Shri Kabe has relied on sections 211, 213, 216, 217 and 218 of the Indian C .....

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..... s to be clearly erroneous. The view held by the Collector that there is privity of contract for the manufacture and sale of materials between the block engravers and the appellants is also, therefore, erroneous. It cannot, therefore, be held, as held by the Collector, that what takes place between the block- makers and the appellants is a sale of the blocks by the appellants to their clients. When the principal is known, as in this case he is known to the block-makers, there is Prima facie no contract with the agent, although when the principal is not known, then prima facie the agent, though known to be an agent, does not bind himself personally, the other party not being presumed to give credit exclusively to an unknown principal. (Polloc .....

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..... ks in question cannot be sold by the appellants in the market to other customers as the designs for the blocks are approved by the clients exclusively for their own purposes, and would be useless to any other persons. It cannot, there- fore, be held that the appellants had such dominion over the blocks, after they are received from the custody of the block-makers, as a pur- chaser would have, because even if it can be said that the blocks were purchased by the appellants, it must be held that they were purchased not on their own account, but on their clients' behalf. In our opinion, our decision in Messrs. Umeschandra Hariprasad v. The State of Bombay(1) (1) (1953) 3 Bom. S.T.T. S.D. 25. applies to the facts of this case. Similarly, in Bhog .....

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