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TMI Blog1988 (10) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... r referred to as "the Act") and is not liable for any assessment of sales tax. Previously the petitioner not being aware of the correct legal position was paying sales tax. As soon as it came to know of the real legal position, the petitioner denied its liability for assessment. But, the respondentDeputy Commercial Tax Officer, Erode, rejected the contention of the petitioner and passed the impugned order levying tax for the year 1986-87 on a total turnover of Rs. 23,57,198. Hence this writ petition. 3. The Deputy Commercial Tax Officer, Erode, has filed a counteraffidavit challenging the contentions of the petitioner and disputing the maintainability of this writ petition. 4.. Under section 3 of the Act, the liability to pay sales tax on the taxable turnover is fastened on every dealer whose total turnover for a year is not less than Rs. 50,000. The main question which, therefore arises is whether the petitioner is a "dealer" within the ambit of section 2(g) of the Act, which runs thus: "'Dealer' means any person who carries on the business of buying, selling, supplying or distributing goods, directly or otherwise, whether for cash or for deferred payment, or for commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re: that the agriculturist is liable for any shrinkage, the commission agent has no right to sell the turmeric and that it is the responsibility of the agriculturist-producer to decide the price and sell the same. After the auction is over and the price is agreed to by agriculturist-producer, the weighing receipt is issued by the petitioner-commission agent giving the full details about the agriculturist-producer, the purchaser, the weight of the goods sold, their total value and the service charges. It contains a recital by the agriculturist-producer that his turmeric bags are sold by him in auction at the rate agreed to by him and that he is receiving the sale amount from the petitioner after deducting the expenses and charges. This receipt is signed by the agriculturistproducer, the purchaser and by the representative of the petitioner-firm. On the same day the Marketing Committee, in whose premises the auction takes place, issues a receipt for the number of the bags and the weight therefor and this is signed by the agriculturist as seller and by the merchant. It also contains the signature of the weigher and the receipt of the weighing charges. 6.. In the counter-affidavit fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which there is no controversy clearly establish that the assessee cannot be said to have authority to transfer the property in the goods. Even if the assessee could be said to have dominion over the goods if it did not have authority to transfer the property in such goods, certainly as per the law laid down by the Bench, referred to already, [Zackria Sons Private Ltd. v. State of Madras [1965] 16 STC 136 (Mad.)], the assessee in the present case cannot be said to have effected a sale and, therefore, cannot be said to have acquired a turnover liable to sales tax." In Karelal Kundanlal Trust v. Commissioner of Sales Tax [1980] 46 STC 202 (MP), the cultivators brought their produce to a place in the mundy in the occupation of the assessee as licensee. The produce so brought by the cultivators are sold by auction and the bid was accepted by the cultivators, who remained present till the goods were sold. The buyers then removed the goods from the place. The assessee issued a bill to the buyers and entered the name of the buyers and sellers in the books. The price was paid to the cultivators and the assessee retained the commission. The Bench held: "It is difficult to hold that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... freight. The Supreme Court observed that if the company apprehending that it may have to pay sales tax on the freight, collected sales tax on the freight, the true nature of the contract between the company and the purchasers cannot on that account be altered, that the company may be liable to refund the amount of excess sales tax to its purchasers, but, that is a matter between the company and the purchasers and the State cannot seek to levy tax on the railway freight if it was not made a part of the price. Hence the fact that the petitioner has in prior years accepted the liability and paid sales tax does not stop the petitioner from challenging the assessment for the subsequent years on a true appreciation of the position of law. 10.. It is finally urged by the learned Government Advocate that the petitioner has not availed of the remedies available to him under the Act by way of appeal, etc., and he is not, therefore, entitled to seek the extraordinary jurisdiction of this Court under article 226 of the Constitution. This contention has not been specifically raised in the counteraffidavit. Further, the availability of alternative remedy is not an absolute bar to the maintain ..... X X X X Extracts X X X X X X X X Extracts X X X X
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