R. M. Sahai, J. - The following question has been referred by the Additional Judge (Revision), Sales Tax, Agra :-
'Whether on the facts found the assessee could be held to be the dealer as defined by the U.P. Sales Tax Act ?'
2. The facts giving rise to this reference are these : The assessee claimed to be a mere weighmen (Taula) of foodgrains and oilseeds for the assessment year 1959-60. The assessing authority rejecting his claim and held him to be a Commission Agent against which the assessee went in an appeal and revision but he was not successful.
3. The definition of dealer in the U.P. Sales Tax Act, as it stood in the year 1959-60 reads as follows :-
'Sec. 2 (c)
(c) dealer means any person or association of person carrying on the business of buying or selling goods in Uttar Pradesh whether for commission, remuneration or otherwise and includes any firm or Hindu joint family and any society, club or association, which sells goods to its members and also includes any Department of the State Government or the Central Government which carries on such business and any undertaking engaged in the generation or distribution of electrical energy or any other from of power.
The definition of the dealer had been amended from time to time and its ambit had been extended so as to cover within its fold any person who carried on business of buying and selling. The charge is created by the Act on a person who is a dealer. To satisfy the test of a dealer one must carry on business of buying and selling.
4. The modus operendi of the assessee for carrying on business has been set out in the assessment order in the following words :
'The very facts that purcha level are issued showed that the payments are made after lapse of time and not immediately. In such case where cultivators, required money it is always paid by the Kacha Arhatiyas. The dealer has not maintained any Rokar from which his investment could be judged. The shop premises were surveyed on 29-6-1959. During the year 1959-60 it was found that he was having goods in stock at that time. At the time on subsequent survey on 21-12-1959 15 21-12-1959 15 bags of groundnuts 15 bags of paddy were found in stock in the shop premises. This clearly shows that the dealer stocked goods on behalf of principal to be sold subsequently at suitable rates.'
This finding was affirmed by the Assistant Commissioner (Judicial). The Additional Judge (Revision), Sales Tax, Agra also did not set aside any of these findings. It appears that before the Judge (Revision) it was urged that the fact that certain paddy or groundnut was found in the stock of the assessee, did not mean that he was carrying on business and selling unless he had authority to conclude sale. It was also urged before him that as cultivators were present at the time of the sale it was indicative of the fact that the assessee was acting only as a broker and not as a dealer. The Additional Judge (Revision) rejected this contention in the following words :
'The entire sale transaction is effected by Kacha Arctiya, even if in some cases, the cultivator might be preset at the scene as a spectator. If the Kacha Arhtiya did not have the authority to sell, his function would cease, and nobody would bring his goods to the shop for paying remuneration for no services. It is true that if the cultivator is personally present, his consent is also finally obtained before finalising the transaction, but the sale is not effected by the cultivator himself, but by the Kacha Arhtiyas the cultivator is completely ignorant of the mechanism of the Mandi and brings his goods to the Kacha Arhtiya only for his service as an expert.'
It has been strenuously urged on behalf of the assessee that this amounts to a finding by the Judge (Revision) that all transactions were carried out in presence of the cultivators and with their tacit consent. We are unbale to accept the contention as in our opinion the above observations were made only while rejecting the contention advanced before the Judge (Revision) in assailing the findings recorded by the appellate court. It is, no doubt true that the Judge (Revision) has not recorded any independent finding; but as he was affirming the judgment of the appellate court we do not find any infirmity on this score.
5. The learned counsel for the assessee next submitted that the mere issuing of parcha level by the assessee did not mean that he was dealer and not a broker Reliance has been placed on the following observation in Commissioner of Sales Tax, U.P. vs. Vijay Kumar Krishna Kumar (21 Sales Tax Cases 37) at page 39 :
'It is clear that no single factor can be determinative of the question whether a person is a mere broker or a buyer or seller on behalf of another. The issuing of Pacha by the assessee to both the purchasers and sellers may only mean that they are acting as broker for both parties in as much as they are bringing the purchaser and seller together and Parchas are issued by them only for convenience and record. In any event the issuing of Parchas cannot possibly override other factors which point clear to the relationship of broker and client and not that of a buyer and seller on behalf of others. Those factors are that the goods are brought by the sellers themselves and sold in their presence and at the price stipulated by them on the same day or the latest on the next day. The property in the goods, atleast, with regard to such sales never passed to the assessee. It is only in respect of such transactions that the Judge (Revision) has directed to be excluded as not being purchases and sales for and on behalf of any one. It is therefore not necessary to consider whether in respect of sales which were not effected on the same day or the next day the property in those goods passed to the assessee or not. In respect of all other transaction including those where advances were obtained from Banks for the sellers by pleading the stocks the assessee has been held to be a dealer.'
We agree with the observations made by the Division Bench in 21 S.T.C. 37 that mere issuing parcha Level may not be conclusive to establish whether an assessee is a dealer or a mere broker, but where the circumstances are such which lead to the conclusion that the assessee would be liable to tax under the provisions of the U.P. Sales Tax Act. As pointed out earlier the courts below have found that the assessee had premises where he carried on business stocked the goods of his principals, made advances to the cultivators, issued parcha level, sold the goods when favourable prices were secured and made payments after the transactions were completed. These factors taken together lead to an irresistible conclusion that the assessee was carrying on the business of having and selling and was not a mere broker or weighman. Even in the decision cited by the assessee, it is seen that in those cases where made by the assessee by pleading the stock with the Bank, he was held to be a dealer.
6. It has further been urged by the learned counsel for the assessee that the score of the reference is confined to the order of the Judge (Revision) and that we cannot look into the finding recorded by the appellate court or the assessing authority. We do not agree.
7. The requirement under section 11 of the U.P. Sales Tax Act is that the question of law must arise out of the order passed by the Revising Authority or the Additional Revising Authority. If the question of law arises then a statements of the case is submitted by the revising of Additional Revising Authority to the High Court for its opinion. The statement of case consists of the judgments given by the appellate court and the assessing authority along with such other documents as the court may consider necessary for the decision of the question of law. The High Court thereafter under section 11(6) of the Act hears the case and decides the question of law raised thereby. It is clear therefore, that the question of law referred to the High Court is decided in the light of the statement of the case submitted to it. The order of the appellate court and the assessing authority being part of the statement of case cannot be overlooked. The submission of the counsel for the assessee, therefore, that not only the question of law should arise out of the order of the Judge (Revision) but the decision should also be based only on the findings, recorded by the Judges (Revision) does not appear to be correct. The Judge (Revision) has affirmed the findings recorded by the appellate court and the assessing authority. It was not necessary therefore, for the Judge (Revision) to give detailed finding on every aspect of the case.
8. Sri V. D. Singh, the learned Standing Counsel has brought to our notice a decision reported in Commissioner of Sales Tax U.P. vs. M/s. Kraya Bikraya Samiti Chitbaragaon (1975 U.P. Tax Cases page 722 : 1976 CTR (All.) 29, where the question of law was answered by this court on the findings recorded by the appellate court. In the circumstances we do not find any merit in this submission.
9. In view of our foregoing discussions we answer the question referred to us in the affirmative against the assessee and in favour of the Department. Our answer to the question is as follows :
'On the facts found the assessee was a dealer as defined under the U.P. Sales Tax Act.'
10. In the circumstances of the case we direct the parties to bear their own costs in this reference.