LexSTATE OF MADRAS versus CEMENT ALLOCATION CO-ORDINATING ORGANISATION
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548 STATE OF MADRAS v, CEMENT ALLOCATION CO-ORDINATING ORGANISATION September 1; 1971 [K, S. HEGDE AND A. N. GROVER, JJ.l Madras General Salt'.\' T(/x Act 1959 and Rules-A~ent a 'dealer' under .'i. 2(9)-PackinR n1nterials deductible front total turnover under r. 6(c) (11)-Agent selling cement on behalf of principal-Price of pack- inR nu1teriaL shOll'n separately in hf!ls-ARellt is enritled to so111e exe1np~ tions as principcd-Deduction in rrspect of pocking 111aterinl 11 1hen ran he claimed. The assessee (respondent herein) \V~s the .<:elling: agent of a cement company. Under s. 2(g) of the Madras General Sales Tax Act, 1959 the term 'dealer' is defined to include a commission a~cnt. In February 1967 the Deputy Commercial Tax Officer. Lalgudi, asked the asscssee to show cause why its tu'rnover relatirig to the price of the µacking material used in packing the cement sold should not be included in its taxable turnover under the Madras General Sales Tax Act. 1959. The assessee thereupon moved the High Court under Art. 226 of the Constitution. In its petition the assessee averred that its right.;; were the S'!me as those of its principal and since- the p'rice of packing: material was separately shown in the bills the same was deductible from the total turnovelr in view of r. 6(c)(ii) of the Rules under the Act. The High Court held that the assessee was entitled to deduct from its total turnover the turn- over -relating to the packing charges if its principal would have been en- titled to deduct the same had the principal sold tne cement in question directly. The question whether in the present case the principal was so . entitled was not decided hy the High Court. The State appealed to this Court. HELD; Under the general law the agent merely rcp'resents the prin· cipal. Therefore while functioning within the scope of the agency he can exercise all the rights which his principal could have exercised. This provision must hold good even under the Madra.s General Sales Tax Act .unless othe'rwise provided therein. The fact that for the purpose of that Ai;t an agent is considered as a dealer does not alter the 1egal position in other respects. Excepting to the extent other,vise provided in the Act the agent must be held to represent his principal while dealing with the goods of his principal; he merely steps into the shoes of his principal. He is entitled to the same exemptions as his principal \Vould have got had he dealt with the concerned goods himself. The decision of the High Comt to this effect wns correct. [550 H-551 B; 552 El [The question whether the principal in the preo;ent case was entitled to the exemption claimed having been left ooen by the High Court, this Court did not find itself called upon to decide that question. However it drew the attention of the assessing authoritv to the principles laid dow,n by this Court in the case of the Hyderahad Drcran Ci~nrrtte Factory.) [551 Cl Hydernbad Deccan Cigarette Factar.v v. Stnre of Andhra Pradesh, S.T.C. 17 p. 624, referre<l to. A B c D E F G H MADRAS V, CEMENT ORGANISATION (Hegde, !.) 549 ' A crnr. APP!!LLATE JURISDICTION : Civil Appeal No. 2300 of 1968. Appeal from the judgment and order dated October 18, 1967 of the Madras High Court in Writ Petition No. 637 of 1967. Bishan Narain and A. V. Rangam, for the the appellant. B S. T. Desai and B. P. Maheshwari, for the respondenit. The Judgment of the Court was delivered by Hegde, J. This appeal by certificate arises from the decision of the High Court of Madras in Writ Petition No. 637 of 1967. fhe petitioner before the High Court is M/ s. Cement .Allocation Co-ordinating Organization, a selling Agent of DalIIlla Cement C (Bharat) Ltd. That Organization will be hereinafter referred to a~ the 'assessee'. On February 28, 1967 the Deputy Commer- cial Tax Officer, Lalgudi wrote to the assessee to show cause why its turnover relating to the price of the packing materials used in packing the Cement sold should not be included in its taxable turnover. The assessee instead of showing cause against D that proposal moved the High Court of Madras under Article 226 of the Constitution to direct the assessing authority not to include that turnover in its taxable turnover. The High Court enter- tained that Writ Petition. It would have been proper if the High Court had directed the assessee to put forward its case before the authoritie
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