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TMI Blog2011 (6) TMI 701X X X X Extracts X X X X X X X X Extracts X X X X ..... ete and also agreed to by the learned counsel for the parties, considering the nature of the case, the writ petition is taken up for final disposal at this stage. Heard Mr. B.N. Majumder, learned counsel appearing for the petitioner as well as Mr. P. Gautam, learned counsel appearing for the Staterespondents. Also heard Mr. P.K. Biswas, learned Assistant SG appearing for the respondent-Union of India. The pleaded case of the petitioner is that the petitioner is a sole proprietorship firm, a registered dealer under the Tripura Value Added Tax Act, 2004 and the Tripura Value Added Tax Rules, 2005 and also a registered dealer under the Central Sales Tax Act, 1956 and the Central Sales Tax Rules, 1957. Certificate of registration was issued to the petitioner on February 8, 2006 vide registration No. 16060164203 (Central). It is contended in the writ petition that the petitioner-firm is carrying business of different products manufactured by the different companies and body corporate established outside of Tripura as commission agent. It is also stated that the petitioner-firm is also a consignment agent of Mahabir Agency (for short, the principal ) whose CST No. Gau/B/994. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion to issue form F. At this stage, Mr. Nandi Majumder, learned counsel for the petitioner submits that the petitioner will not press the revision petition before the revisional authority as due to misconception of law, the petitioner filed the instant revision petition. The appropriate remedy is to file an appeal before the appellate Tribunal which is not functioning in the State of Tripura at present. The respondents filed their counter-affidavit in the C.M. Application No. 145 of 2011 arising out of the instant writ petition denying the contention of the petitioner. It is submitted by Mr. Gautam, learned State counsel, that the State respondents will not file any further counter in the writ petition and the same may be treated as reply to the writ petition. In the counter, it is contended that under the Central Sales Tax Act, 1956, two types of certificate of registration are provided to the dealer one is liable to pay tax and the other is not liable to pay tax. When a dealer applies under section 7(1) of the CST Act read with rule 4(1) of the CST Rules, 1957, he will be registered under section 7(3) of the CST Act, 1956 for liable to pay tax under the said Act and whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertificate of registration separately under section 7(2) of the CST Act, 1956 read with rule 4(2) of the CST Rules, 1957 is wholly unreasonable and contrary to the provisions of law. He further submits that mere providing the payment of goods as an advance either by demand draft or by cash to the principal would not change the character of the petitioner as an agent, as in the said agreement, it is specifically mentioned that the petitioner has to charge on principal a commission at five per cent on the sale amount. In support of his aforesaid contention, he placed reliance on a decision of the apex court in the case of Commissioner of Income-tax, Bombay v. S.K.F. Ball Bearing Co. Ltd. [1960] 40 ITR 444 (SC); AIR 1960 SC 1294, wherein the apex court considering the fact of that case noted, inter alia, that the relation between the S.K.F. and the foreign corporations was not altered because before realizing the price from the buyers remittances were made to the foreign corporations. The price of goods sold by the S.K.F. whether before or after remittance was realized as the agent of the foreign corporations. If remittance in respect of a sale was made before the price was rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State of Tripura for selling the same in the State of Tripura, then he is not entitled to get form F and in the instant case, the petitioner is purchasing goods from its socalled principal, thus he is not entitled to get form F. He further contended that the petitioner-firm being not a registered one has no locus standi to seek remedy under article 226 of the Constitution. He also contended that there is difference between the contract of sale and contract of agency. In contract of sale, title of goods is transferred to buyer and in contract of agency, the title of goods remains with the seller and latter has to make sale proceeds of the goods of former, i.e., the principal. He further submits that in case of sale, the title of the goods is transferred to the purchaser, but in a case of stock transfer, the title remains with the principal and the transferee is to pay price received from selling the goods on the basis of his promise to his principal. In the instant case, from the appointment letter, annexure P1, to the writ petition, it is evident that the petitioner is making full payment as advance to his socalled principal for the goods which would be received by him. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as no need to mention the price at all as between the plaintiff and the defendants. . . . In para 9 of the said Report, the apex court further held that it is well established that even an agent can become a purchaser when an agent pays the price to the principal on his own responsibility. . . . He also referred to a decision of the apex court in Sri Tirumala Venkateswara Timber and Bamboo Firm v. Commercial Tax Officer, Rajahmundry [1968] 21 STC 312 (SC); AIR 1968 SC 784 wherein their Lordship considered the difference between contract of sale and contract of agency and noted that as a matter of law there is a distinction between a contract of sale and a contract of agency by which the agent is authorized to sell or buy on behalf of the principal and make over either the sale proceeds or the goods to the principal. The essence of a contract of sale is the transfer of title to the goods for a price paid or promised to be paid. The transferee in such a case is liable to the transferor as a debtor for the price to be paid and not as agent for the proceeds of the sale. The essence of agency to sell is the delivery of the goods to a person who is to sell them, not as his own pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereof. . . . R. 4(2). An application for registration under sub-section (1) of section 7 shall be made not later than thirty days from the date on which the dealer becomes liable to pay tax under the Act. In State of Tamil Nadu v. Cocoa Products and Beverages Limited [1998] 109 STC 634 (Mad), the Madras High Court while considering the objects of sub-section (1) of section 6A of the Central Sales Tax Act, 1956 and form F prescribed under rule 12(5) of the Central Sales Tax (Registration and Turnover) Rules, 1957, held in paras 16 and 17 of the said report that (pages 642 and 643 in 109 STC): 16. Section 6A of the Principal Act had been inserted for the purpose of providing that the burden of proving that movement of goods from one State to another was occasioned otherwise than by way of sale shall be on the dealer making the claim. For the purpose of discharging its burden, the dealer may produce a declaration in the prescribed form from the person in the other State, to whom the goods have been sent, along with the evidence of such dispatch of goods. Therefore, what is requisite and necessary for the dealer to claim exemption in respect of the transaction of dispa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... what is requisite and necessary for the dealer to claim exemption in respect of the transaction of dispatch of goods from one State to another for sales on consignment basis through agent is to produce declaration in the prescribed form, that is to say, form F, with the evidence of the dispatch of such goods, and nothing further. To put it otherwise, the section does not at all require any written agreement or contract evidencing appointment of agent for the purpose of effecting sales on consignment basis through agent by the principal moving the goods for such sale to another State. A perusal of form F clearly indicates that the agent must be a registered dealer under the CSTA, where he transacts his business. It is also made clear by the first proviso to rule 12(5) that a single declaration may cover transfer of goods, by a dealer, to any other place of his business or to his agent or principal, as the case may be, effected during a period of one calendar month. 17. The information required on the body of form F as to 'date from which registration is valid' and the first proviso to rule 12(5) of the Rules, we rather feel, must have to be construed in a liberal way so a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Dear Sir, As per discussion held with you at our Guwahati Office, we are very glad to inform you that we have appointed you as our consignment agent for the period 2009-10, (i.e., April 1, 2009 to March 31, 2010) and authorized you to sell our ALL PRODUCTS (WASHING SOAP) in carton box packing for the same period as per terms and conditions given below: 1. You will send full payment as advance by demand draft and one blank F form against your order. 2. We will dispatch the goods through our preferable transport after receipt of full payment in advance only. 3. You will sell our products as per our invoice rate and charge us commission at five per cent on sale amount only. 4. You will send us F form, copy of sale bill for every month in the first week of the next month. 5. Any local taxes chargeable are liable by the sale agent who will collect and deposit to the local authority concern. 6. All the disputes, if arisen will be settled mutually by both the parties otherwise the matter will be sent to Guwahati jurisdiction only. 7. We shall terminate this agreement any time by giving one month notice to you. This agreement is valid for the period from Apr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive society or other society, club, firm, Hindu undivided family or other association of persons which carries on such business; (ii) a factor, broker, commission agent, del credere agent, or any other mercantile agent, by whatever name called, and whether of the same description as hereinbefore mentioned or not, who carries on the business of buying, selling, supplying or distributing, goods belonging to any principal whether disclosed or not; and (iii) an auctioneer who carries on the business of selling or auctioning goods belonging to any principal, whether disclosed or not and whether the offer of the intending purchaser is accepted by him or by the principal or a nominee of the principal. Explanation 1. Every person who acts as an agent, in any State, of a dealer residing outside that State and buys, sells, supplies, or distributes, goods in the State or acts on behalf of such dealer as (i) and (ii) . . . (iii) an agent for the collection or the payment of the sale price of goods or as a guarantor for such collection or payment. and every local branch or office in a State of a firm registered outside that State or a company or other body corporate, the prin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e counsel of the assessee of that case has conceded that SKF was not a purchaser of goods received on consignment from the foreign corporation but was their agent for sale of the goods, an answer in the affirmative was recorded on the first question. In the said judgment, the apex court also noted that the relation between the SKF and the foreign corporations was not altered because before realizing the price from the buyers remittances were made to the foreign corporations. The price of goods sold by the SKF whether before or after remittance was realized as the agent of the foreign corporations. If remittance in respect of a sale was made before the price was realized, the SKF became entitled to adjust the account and to take credit for the amount paid out of the realization. What the foreign corporations received under remittances made before or after realization of the price was not the sale proceeds in respect of sales, but amounts due by the SKF under an obligation expressly undertaken by it under clause 23 of the agreement. In the instant case also, the relation between the petitioner and his principal is not altered only for making advance payment for goods which will ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titioner is not purchasing the goods from its principal, Mahabir Chemicals, rather, he is acting as a commission agent for selling the product of his principal, Mahabir Chemicals and advance paid to principal cannot be considered as sales proceeds. More so, when the appointment letter itself says that the petitioner is a consignment agent for selling the goods of the principal in the State of Tripura, he cannot be denied the form F only on the ground of nonregistration of its principal in the State of Tripura. At best, the authority can ask the petitioner to furnish security in terms of section 7(2A) and (3A) of the Act and if asked for security in terms of section 7(2A) and (3A) of the Act, then the petitioner is bound to deposit the said security amount to get the form F subject to in the mind of the Revenue authority, there is any apprehension regarding misuse of form F by the petitioner which may result any prejudice to be caused to the Revenue. In the instant case, when the respondent-authority initially provided form F to the petitioner even when the principal of the petitioner was not registered under section 7 of the Act, then on what ground they all on a sudden stopp ..... 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