STATE OF ANDHRA Vs. CHODEY JANAKIRAMAYYA AND CO
LAWS(APH)-1955-2-4
HIGH COURT OF ANDHRA PRADESH
Decided on February 16,1955

STATE OF ANDHRA Appellant
VERSUS
CHODEY JANAKIRAMAYYA AND CO. Respondents


Referred Judgements :-

HIRANAND RAMSOOK FIRM VS. PROVINCE OF MADRAS NOW ANDHRA [REFERRED TO]


JUDGEMENT

- (1.)THE State of Andhra is the appellant. The respondent herein filed a suit for recovery of the sales tax wrongly collected from him under the provisions of the Madras General Sales Tax Act. The trial Court dismissed his suit. But on appeal, the Subordinate Judge decreed his claim.
(2.)THE main question raised by the learned Government Pleader is that the respondent has violated the provisions of section 8 of the Act and rule 12(3) of the Madras General Sales Tax Rules, 1939. Section 8 is in the following terms :-
"The State Government may, on application and on payment of such fee as may be prescribed in that behalf, license any person under this section who for an agreed commission or brokerage, buys or sells on behalf of known principals specified in his accounts in respect of each transaction and may exempt from the tax or taxes payable under section 3, such of this transactions as are carried out in accordance with the terms an conditions of his licence."

Rule 12(3) runs as follows :-

"If a person who holds a licence under section 8 also deals otherwise than for an agreed commission or brokerage on behalf of known principals in the State, he shall keep separate accounts in respect of such transactions and of transactions covered by the licence."

(3.)ACCORDING to the learned Government Pleader, the respondent has not maintained separate accounts of his own dealings and the transactions which he carried on as a commission agent and that therefore he is not entitled to claim exemption under section 8 of the Act. There is no doubt that the respondent has been maintaining separate ledgers in respect of the commission agency business. The chitta that he was maintaining, however, contained both the dealings which he carried on his own behalf as also as a commission agent. The point which falls to be determined is what exactly is the meaning of separate accounts in rule 12(3). The chitta maintained by the respondent shows clearly what transactions relate to his own business and what transactions he carried on as a commission agent. Though it is no doubt written in a single chitta or account book, the transactions are separable and are identifiable. I, therefore, hold that separate accounts are being maintained by the respondent though noted that in a single chitta and that he has not in any way violated the provisions of rule 12(3). The same question was considered recently by Bhimasankaram, J., in S.A. No. 2268 of 1950. The relevant observations are as follows :-
"Again, it is true that the rule requires the maintenance of separate accounts. But I am not satisfied that it is necessary that two separate account books should be kept. In fact, it appears from the facts in the present case, that the plaintiff has been keeping two ledgers, one relating to his personal business and another relating to his commission business, though the day book that he keeps mixes up both the kinds of transactions. I do not read the rule as necessitating the maintenance of two separate account books, i.e., two separate day books and two separate ledgers."

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