MECLEOD & CO. LTD. versus STATE OF ORISSA & ORS.

Citation: [1984] 1 S.C.R. 865 · Decided: 23-11-1983 · Supreme Court of India · Bench: V.D. TULZAPURKAR · Disposal: Dismissed
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Judgment (excerpt)

865 
' MECLEOD & CO. LTD. 
• 
v. 
STATE OF ORISSA & ORS. 
November 23, 1983 
~ 
[VJ). TuLZAPURKAR, R.S. PATHAK AND SABYASACHJ MuKHARJI, JJ.) 
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t~ 
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Orlssa Taxation (on Goods carried by Road and Inland Waterways) Act, 
1959 valid'lted by Art of 1968-S. 2(5)-Read with explanation thereto-Definition 
of deaier-Interpret(aion of . !Janager o'r agent of non-res(den:·. dealdr. need not 
have place ofbusine_ss or residence ;n Orissa Staie to be deemed to be dealer. 
Dealer-Whether non resident de~ler-Testfor determining r'esidence. 
°.the. ·a~p~Uant-company w~s appoi~ted as 'Managing . Agent•. and 
S.ecretary & Treasurer' respectivel:Y by .tWo independent and separate -public 
.1in1ited .. jute mills coirpanieS. Tbcise jute mills had their registered office· at 
Calcutta and additio ai places of business in several parts of_ ihe· country 
· including-Kendupatna in the State of Orissa ·and were- registered as 'dealers' 
under the Otissa Taxation (on Goods carried by Road arid Inlaiid Waterways) 
ACt, 1959. The appellant-company di4 not do any business nor had any place of 
its business in any part of . the. State of Orissa. But the appellant-company · 
lOOked after the wor~ of storing jute of the two jute mills In their godowns at 
Kendupatna in-the State of Orissa. The Assistant Tax Officer· passed ex-parte . 
~ssessmeitt orders against the appellant-company on the. business of stocking, 
· storing and carrying jute by boats of the jute mills in' the State of OrisSa on the 
basis.-that the appellant-'company was a ·4ealer~ (as agent of both the jute ihills)' 
within the n1eaning of s. 2(5) read With the Explanation _thereto Or the Act. The 
Assistant Commissioner ofTaxcS .disffiissed the appeal· and Coi11miS£ioner of 
·Taxes dismissed the revision J,eiition filed by the appellant-company against the 
assessment orders. Jn a writ petition, the High Couft negatived·the contention 
of the a'ppellant-companY that il Was not a deale"r. Int.his appeal;. the appellant- . 
_company contended: (1) that in order to be deemed to be 'a dealer ullder.s. i(S) 
read with Explanation thereto a manager, or an ·agent of a dealer must ·reside 
or have a place of business .in "the State of· Ori_ssa. a_nd since the :appeIJant-
company did not have an}: such place of business in the State:o·f Orissa it was 
not a dealer under that section, and . (2) that the jute companies (PrinciPals). 
were Dot 'n_on.-re~ident dealers' as required by the Explanation to s. 2(5) since 
each one had a _place of business of its own in the State of Orissa. 
·Disn~issing ~he appe8I, 
... 
HELD : The appell3.nt-company was a d.ealer within ·the meaning of 
s. 2(5) read with· the F xplanation thereto of the Orissa Taxation (on Goods. 
carried by Road.and Inland Waterways) Act; 1959. 
~876 El, 
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866 
SUPREME COURT RBPOR'lll 
(1984) I S.C.R. 
Under the Ex,.Planation ·to s. 2(5) of the Act, the manager or agent of .a 
'dealer' who resides outside the State is:atso deemed to be a 
~dealer• for the 
purpOse of the Act inespective of whether he resi~es inside or outside the State. 
. The.artificial definition of a •dealer' under the Explanation is·merely an enabl~ 
. ing provision which facilitates the assessment against a non~resldent dealer but 
the provision does not require that the n1anager or the agent sll.ould have either 
a residence or a place of business within thf: State: of Orissa. There is nothing 
.either in the main.definition or in the Explanation tO suggest ·that the manager 
. or agent of the dealer (Principai) should have his own buSiness within the State' 
of.Orissa before he could be proceeded against or assessed under the Act; All 
that the Explanation requires is that the managet or the .agent should 'Store 
such goods of the non-residt!nt •dealer' within the State of Orissa but that dqes 
_not mean t)tat for such p,urposc the manager or the agent either reside or have 
a place of business within the State of Orissa;. even if he carries out the opera-
tion of storing the goods and carrying the same by motor boats· within. the 
. State of Orissa from outside the State it would suffice. [871 G-H; F; 872 B-C] 
In the insianr ca~e, it is true that during the relevant pefiod it ~as the. 
jute cOmpanies (the Principals) who carrfod on· their jute· business at Kendu-
patna within the State of OriSsa and that the appellant-company ha.d no 
business or' its oWn anywhere in that State but i
Excerpt shown. Read the full judgment & AI analysis in Lexace.