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TMI Blog2000 (8) TMI 1092X X X X Extracts X X X X X X X X Extracts X X X X ..... commission agent or an auctioneer, the assessing authority had levied tax for the abovesaid turnover along with certain other taxable turnovers. But the assessee claimed exemption for the auction sales conducted by them in respect of the tea produced by the abovesaid estates on the ground that the owners themselves had purchased the tea produced by them in the public auction and as the sellers themselves had bought the tea, there was no transfer of any interest and as there was no sale of the goods, the auctioneer, namely, the tea broker could not be taxed. The assessing authority as well as the appellate authorities have rejected this claim of exemption and have levied tax at 4 per cent. The assessee, aggrieved of this order, has come forward with this revision before us. 3.. The learned counsel-Thiru K.J. Chandran appearing for the petitioner raised two points in this revision, namely, as the producers of the tea, namely, sellers themselves had purchased the tea in the public auction, there cannot be a sale within the meaning of the definition of "sale" mentioned in the Tamil Nadu General Sales Tax Act and as there was no actual sale of the commodity, the petitioners who are th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the goods to bring the transaction within the definition of sale, but as the seller and purchaser happened to be the same tea estates, there could not have been any sale of the tea manufactured by Harison Malayalam, Kilkotagiri Tea and Coffee Company and Periakaramalai Tea and Produce Company and as the tax could be levied only when there was sale whereas in this case, there was no sale for want of two parties, the authorities below were wrong in levying tax for the turnover of Rs. 16,59,130 being the auction price adjusted to the account of the tea producers themselves. Even though this argument of the learned counsel may appear to be sound, but on a deep consideration, this argument has no merit. The owner alone can have the full or absolute right in the goods and with such right, he can deal with the goods in any manner either to sell, gift away the property or enjoy the property for himself or abandon it or destroy it. But in the case of tea produced by the estates, they did not have all these powers in respect of their own goods because of order 17 of the Tea (Marketing) Control Order, 1984 which reads as follows: "Every registered manufacturer in the State of Assam, West B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... absolute right, namely, full ownership to deal with the goods in any manner of their choice and therefore, certain rights which were not available to the producer of the tea before auction, were conferred in the auction sale through the tea broker on payment of consideration. Therefore, it cannot be stated that there was no transfer of any interests to the purchaser of the tea. 5.. Section 2(n) of the Tamil Nadu General Sales Tax Act, 1959 defines "sale" in the following manner: "Section 2(n): 'Sale' with all its grammatical variations and cognate expressions means every transfer of the property in goods (other than by way of a mortgage, hypothecation, charge or pledge) by one person to another in the course of business for cash, deferred payment or other valuable consideration........" The definition section requires a transfer of property in goods to make it a sale. Section 4 of the Sale of Goods Act, 1930 reads as follows: "Section 4(1): A contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price. There may be a contract of sale between one partowner and another. Section 4(2):.............. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purchaser acquires the full right in the goods and becomes the absolute owner. Therefore, the right taken out from the manufacturer, has been transferred to the purchaser through the tea broker and therefore, really there was transfer of property in the goods falling under the definition of "sale" mentioned in the Tamil Nadu General Sales Tax Act. So, it is futile to contend that as the seller and the purchaser are one and the same person, there was no sale to levy tax under the Tamil Nadu General Sales Tax Act. As a matter of fact, rule 22 of Part III of Tea Trading Association, Coimbatore reads that the sellers shall be registered as the dealers under the Tamil Nadu General Sales Tax Act, 1959 and the sale price shall be exclusive of sales tax, if any and the seller is entitled to collect the sales tax, if any, applicable from the buyer. In this case, there is nothing to show that the purchasers did not pay sales tax for their purchases in the public auction. When the purchaser had to pay sales tax under the abovesaid rule and this has not been objected to by the purchasers, though they happened to be the manufacturers of the tea, the tea broker is not entitled to contend that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ight in tea to deal with the commodity in the manner of his choice. Section 2(g) of the Tamil Nadu General Sales Tax Act while defining dealer, it includes even a broker and commission agent or arhati and auctioneer who carries on the business of buying, selling, supplying or distributing goods on behalf of any principal, or through whom the goods are bought, sold, supplied or distributed. Under this definition, even if the goods are supplied or distributed on behalf of any principal, the commission agent or broker or auctioneer is to be treated as a dealer for the purpose of levy of tax. As a matter of fact, rule 22(1)(a) of Part III of Tea Trading Association of Coimbatore specifically mentions that the brokers shall be registered as dealers under the Tamil Nadu General Sales Tax Act and be the assessee in respect of the sales belonging to the sales made at the tea auction by the brokers concerned at Coimbatore from time to time. The petitionerassessee has become the broker of the tea only after accepting the rules of the Tea Trade Association. Having so accepted to pay the sales tax, they not only acted as agent to sell the tea of the producers on behalf of the manufacturers, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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