9911796707
TMI Blog1979 (3) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... as purchasing agent for ex-U.P. buyers. It purchased foodgrains and oil-seeds for ex-U.P. principals and, thereafter, packed and stored the commodities in its own gunny bags before sending them to its principals. The ex-U.P. principals were charged separately for the gunny bags. The assessee's contention that the sale of gunny bags was complete in U.P. and, as such, taxable under the U.P. Act, did not find favour with the Sales Tax Officer, who treated it as an inter-State sale. An appeal filed against the assessment, on this point, failed. The Judge (Revisions) has allowed the revision. He has taken the view that the supply of gunny bags was an implied term of the contract of purchase and integrally connected with the purchase of the comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee had charged the price for the gunny bags from its principals, and had instructions to despatch the foodgrains in gunny bags. Secondly, the gunny bags would not have moved outside U.P. but for the purchasing agreement for foodgrains, which were to be despatched in the gunny bags in fulfilment of the agreement. Counsel for the assessee, on the other hand, urged that there was no agreement for the sale of gunny bags and, as such, section 3 had no application at all. It was also contended that there was no sale of the gunny bags, as before a transaction could be a sale at least two entities must be involved in the transaction, one a purchaser and the other a seller and, as in the present case, the assessee acted both as the seller an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harge or pledge on goods." The definition postulates that, before a transaction can be a sale, there must be a transfer of property in goods by one person to another, and the transfer must be for cash or for deferred payment or for any other valuable consideration. It is thus obvious that two entities must be involved in the transaction. The assessee in the present case had two capacities, one as the purchasing agent of ex-U.P. buyers and the other as the owner of the gunny bags. After it purchased foodgrains and oil-seeds for ex-U.P. buyers, it utilised its gunny bags for packing and storing the commodities purchased, and charged the price of the gunny bags from the ex-U.P. buyers. As the assessee was acting in two capacities, two entitie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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