Ramanujam, J.

1. The petitioners herein are dealers in hardware and pipes. They had dismantled the tramlines within the City of Madras, stocked them and sold the rails. For the assessment year 1961-62 they were originally assessed on 25th June, 1962 on a turnover of Rs. 1,09,980.27. Later, the petitioners' place of business had been inspected by the authorities on 30th January, 1965 and certain account books and documents had been recovered. On a comparison of those seized records with the regular accounts of the petitioners it was found that the dealings referred to in the seized records had not been accounted for in their regular accounts. In particular, it was found from those seized records that the petitioners had effected sales of tram rails to a dealer in Calcutta to the extent of Rs. 2,13,386.33 from August, 1961 to March, 1962 but that the said turnover had not been shown either in their accounts or in their monthly returns. It was also found that the petitioners had sold tram rails to two other parties for about Rs. 40,000 during the year 1961-1962. The assessing authority therefore revised the original assessment by including a turnover of Rs. 2,53,378.07 in the turnover already determined as sales suppressions. It also imposed a penalty of Rs. 7,600 under Section 16 (2) of the Madras General Sales Tax Act, 1959, for failure to disclose the suppressed turnover in their monthly returns.

2. The petitioners' appeals against the said addition before the Appellate Assistant Commissioner and the Sales Tax Appellate Tribunal were unsuccessful. Though various contentions were raised before the authorities below, before us the learned Counsel for the petitioners confined his attack on the revised assessment only on one point. His contention was that the sales of rails effected by the petitioners to the various parties during the assessment year are only second sales and hence they are not taxable under the Act. According to the learned Counsel the petitioners purchased the rails in question from Messrs. S.P. Kuppuswami Naicker and Sons who should be taken to be the first sellers of the rails within the State and as such they are liable to be taxed on their sales to the petitioners. It is urged by Mr. M.R.M. Abdul Karim learned Counsel for the petitioners that Messrs. Kuppuswami Naicker and Sons purchased the tram rails from the Madras Electric Tramways Ltd., and subsequently sold the same to the petitioners, and that if really the petitioners arc not the first sellers of the tram rails (iron scrap), they cannot be made liable to tax as iron scrap is liable to a single point levy on the first sale within the State. Therefore, the only question to be decided in this case is whether the petitioners are the first sellers as urged by the Revenue or whether the said Messrs. Kuppuswami Naicker and Sons are the first sellers as urged by the petitioners.

3. The petitioners' learned Counsel referred to the proceedings in O.P.No 419 of 1953 on the file of the High Court and the various orders passed by this Court regarding the sale of the tram rails and submitted that the sale of tram rails ordered by the High Court was only in favour of the said Messrs. Kuppuswami Naicker and Sons and it is from them the petitioners had subsequently purchased the goods. What in substance the learned Counsel submits is that the property in the tram rails had in fact passed to Messrs. Kuppuswami Naicker and Sons and that thereafter the said Messrs. Kuppuswami Naicker and Sons sold the goods to the petitioners. In the light of the above submission, the facts of the case have to be looked at.

4. The Madras Electric Tramways Limited which was running the tramways in the city of Madras went into liquidation and an Official Liquidator was appointed in O.P. No .419 of 1953. In the course of those proceedings, this Court, on 5th August, 1955 directed that the Receiver for the debenture trustees should call for tenders by advertisement in 'The Hindu' for the sale of the assets of the company. In pursuance of such an. advertisement , Messrs. S.P. Kuppuswami Naicker and Sons wrote on 16th August, 1955 to the Solicitors of the Tramways Company giving an offer to purchase the assets of the company for a total sum of Rs. 5,51,111. In that offer they had. valued the 'tramway', .i.e., rails, posts, cables, electrical equipment etc., at Rs. 2,01,111 and the other assets which mainly consisted of immoveable properties at Rs. 3,50,000. The said Messrs. Kupprswami Naicker and Sons had. given an offer on 3rd August, 1955 earlier to the Court order and had actually deposited a sum Rs. 50,000- as earnest money. Therefore, when they submitted their fresh and increased offer on 16th August, 1955 for Rs. 5,51,111 they sent a cheque for Rs. 6,000 which along with Rs. 50,000 already deposited would make up a deposit of Rs. 56,000. The Court considered all the offers on 19th August, 1955 and found that the offer of Messrs. Kuppuswami Naicker and Sons was most satisfactory. It, therefore, directed the Official Receiver to accept the said offer. The acceptance by the Official Receiver was duly communicated to Messrs. Kuppuswami Naicker and. Sons by letter dated 23rd August, 1955 which was actually received by them on 26th August, 1955. on 26th August, 1955 a sum of Rs. 1,95,111 was paid to the Receiver which with the sum of Rs. 6,000 deposited along with the increased offer made on 16th August, 1955 represented the full purchase price of the tramways. Messrs. Kuppuswami Naicker and Sons were informed by a letter of even date that as purchasers of the Company's interest in the tramways they were free to negotiate with the Corporation of Madras for the dismantling and digging up the rails, posts, etc, and that till their removal the materials will be lying at their risk. It is not in dispute that the sum of Rs. 1,95,111 paid to the Receiver on 26th August, 1955 came from the petitioners. Messrs. Kuppuswami, Naicker and Sons wrote to the Receiver on 26th August, 1965 that Bhagwan Motor Company will perform the terms of the sale agreement as their nominees and that they would arrange to take over the rails, posts and overhead wires etc., immediately after making arrangement with the Corporation of Madras. It is in the light of these admitted facts it has to be seen whether Bhagwan Motor Company are the purchasers of the tram rails from Messrs. Kuppuswami Naicker and Sons.

5. Bhagwan Motor Company was a partnership concern consisting of four partners, (1) Narainsingh Ghanshamsingh, (2) P.K. Rama doss, (3) Mohanlal Lakhrajmal, and (4) S.P. Kuppuswami Naicker and sons. S.P. Kuppuswami Naicker was running a sole proprietary concern under the name and style of Messrs. S.P. Kuppuswami Naicker and Sons and that concern was a partner in Bhagwan Motor Company. No doubt M/s. S. P. Kuppuswami Naicker and sons and Bhagwan Motor Company are two independent entities though the former happended to be a partner in the latter firm.

6. The Tribunal has taken the view that the offer made by Messrs. Kuppuswami Naicker and Sons to purchase the tramway Was on behalf of the firm of Bhagawan Motor Company, that the sale ordered by the Court in favour of Messrs. Kuppuswami Naicker and Sons was for the benefit of the petitioner-firm, that the purchase of the tramway was by the firm is fortified by the fact that the sale consideration has been paid only by the petitioners though Messrs. Kuppuswami Naicker and Sons and that, therefore, it is, not possible to assume that there were two sales, one by the Receiver to Messrs. Kuppuswami Naicker and Sons and the other from Messrs. Kuppuswami Naicker and sons to the petitioners. It is not in dispute that there was an agreement in September, 1955 between Messrs. Kuppuswami Naicker and Sons and the other partners of the petitioner-firm to the effect that Messrs. Kuppuswami Naicker and Sons were transferring their rights to the firm as their nominee and the firm alone should undertake the performance of the contract. Apart from this agreement, there is no proof that Messrs. Kuppuswami Naicker and Sons entered into any contract with the firm for the sale of the tramway lines. The learned Counsel for the petitioners would, however, contend that the said agreement should be treated as a sale agreement under which the tramway lines which became the property of Messrs. Kuppuswami Naicker and Sons had been transferred to the petitioners. But the deed of dissolution dated 25th November, 1955 entered into between the partners of the petitioners' firm indicates that the assets of the Madras Electric Tramway Company were purchased for the partnership concern with the partnership funds. As already stated the sum of Rs. 1,95,111 had been paid from and out of the firm on 26th August, 1955, and it is seen that even the first deposit of Rs. 56,000 was made only by Narainsingh Ghanshamsingh, the managing partner of the firm though in the name of M/s. Kuppuswami Naicker and Sons. The accounts of the firm showed that on 20th August, 1955 they had paid Rs. 56,000 in respect of the purchase transactions of tramway lines by M/s. S. P. Kuppuswami Naicker and Sons. From these facts the Tribunal concluded that the purchase from Madras Electric Tramways was by the firm through its partner M/s. S. P, Kuppuswami Naicker and Sons and that, therefore, there is no question of any independent purchase by M/s. Kuppuswami Naicker and Sons from the Madras Electric Tramways and then a subsequent sale by M/s. S.P. Kuppuswami Naicker and Sons to the firm. The Tribunal recognised the fact that a partner of a concern can in law, sell goods to the firm, but it held that in this case the records clearly make out that the purchase of tramways was by the firm through the partner. The Tribunal also held that even if M/s. Kuppuswami Naicker and Sons can be deemed to be the purchasers, there has been no sale by them to the petitioners and the mere assignment of their rights to the petitioners as nominee will not amount to a ' sale' that for constituting a sale, there should be an agreement between the parties to transfer property in the goods for money consideration and that there is no proof that M/s. Kuppuswami Naicker and Sons sold the goods to the petitioners for any consideration.

7. The learned Counsel for the petitioners raises a two fold contention : (1) that the finding of the Tribunal that the purchase of the assets of the tramway lines by the petitioners was by the firm and not by M/s. Kuppuswami Naicker and Sons is unsupportable; and (2) M/s. Kuppuswami Naicker and Sons had in fact transferred the goods to the firm only after the property therein had passed to them and, therefore, the firm, should be taken to have purchased the goods only from M/s. Kuppvswami Naicker and Sons. It is pointed out on behalf of the petitioners that the earliest offer made by M/s. Kuppvswami Naicker and Sons was on 3rd August, 1955 and that offer having been made without reference to the firm or its managing partner, Narainsingh Ghanshamsingh, it must be taken that M/s. Kuppuswami Naicker and Sons had acted in their individual capacity in purchasing the tramway lines. Reference is also made to the payment of Rs. 50,000 as deposit on 3rd August, 1955 by M/s. Kuppuswami Naicker and Sons without reference to the firm or its managing partner.

8. Whatever might have happened before the advertisement, M/s. Kuppuswami Naicker and sons made an offer after the advertisement specifically making it clear that the sale should be either to them or to their nominees. Even the Court which accepted the offer made by M/s. Kuppuswami Naicker and Sons made it clear that the sale of the assets of the tramway company will be either to them or to their nominees. The accounts of the firm also show that not only the deposit amount of Rs. 56,000 but also the balance of the consideration for the tramway lines came from the petitioners' firm. This has also been made clear by the recitals of the dissolution deed dated 25th November, 1955 which specifically states that the assets of the tramway company were purchased for the firm. It cannot be forgotten that M/s. Kuppuswami Naicker and Sons are a partner in the firm and they are entitled to act on behalf of the petitioners' firm as such partner. Further, in the dissolution of partnership all the assets purchased from the tramway company were taken into consideration and the rights and liabilities of the partners were determined on that basis. As already stated, there is no material to show that M/s. Kuppuswami Naicker and Sons actually sold the tramway lines to the firm. As a matter of fact the learned Counsel of the petitioners is not able to say as to what is the amount paid if any, by the firm to M/s. Kuppuswami Naicker and Sons as price for the goods. But he points out that the sum of Rs. 2,01,111 paid to the tramway company as price for the tramway lines should be taken to be the consideration both for their purchase from the tramway company and for their sale to the firm. We are of the view that the facts of this case clearly indicate that the purchase of tramway lines by M/s. Kuppuswami Naicker and Sons from the tramway company was really for the firm, that as the offer was made only in the name of M/s. Kuppuswami Naicker and Sons, the firm had been nominated in their place, that M/s. Kuppuswami Naicker and Sons did not become purchasers in their own right and that the firm, who is the nominee, is the actual purchaser. The Court order having sanctioned the sale either to the offeror or to his nominee, the nomination having taken place before the actual price was paid, the sale in this case should be taken to be a direct sale by the Receiver to the firm.

9. The second contention proceeded on the basis that M/s. Kuppuswami Naicker and Sons made their offer in their individual capacity and transferred the goods to the firm after the property in the goods purchased had vested in them. But as we have held that the purchase of tramway lines was only by the firm through Messrs. Kuppuswami Naicker and Sons, one of its partners, the above question does not arise for consideration at all.

10. The petitioners' learned Counsel refers to the decision in Bayyama Bhimayya v. Government of Andhra Pradesh : [1961]3SCR267 , in support of his contention that the transaction by which the firm became the owner of the goods should be treated as comprising two sales. In that case a dealer in gunnies entered into contracts with two mills agreeing to purchase gunnies at a certain rate for future delivery either to him or to his nominee. The Mills, however, made it clear that they will have no privity of contract with the nominees and the dealer alone will be treated as their purchaser. Before the date of delivery the dealer entered into agreements with third parties by which he charged something extra from those third parties and handed over to them the delivery orders. The Mills delivered the goods to the third parties against such delivery orders. The dealer contended that there was one transaction of sale between the Mills and the third parties and that the transaction between himself and the third parties could not be treated as a sale. The Supreme Court held there were two transactions of sale, one by the Mills to the dealer and the other from the dealer to the third parties. But that Was a clear case where the dealer had admittedly entered into sale transactions with third parties and handed over the delivery orders enabling them to take delivery of the goods from the mills, and the mills refused to recognise the third parties an the dealer's nominees for purposes of their sales to the dealer. In the instant case, as already stated, there is no evidence that M/s. Kuppuswami Naicker and Sons entered into any sale transaction with the firm before nomination. Further, the Court specifically sanctioned the sale either to the offeror or to its nominee. We are, therefore, unable to invoke the principle laid down in that case. State of Andhra Pradesh v. Kolla Sree Ramamurthy : [1963]1SCR184 was also relied on. There a dealer in gunny bags had entered into contracts of purchase of gunry bags with manufacturers. In pursuance of those contracts goods had been appropriated and packed in bales by the manufacturers. The dealer also made a deposit of Rs. 15 per bale, but instead of taking delivery of the goods, he took a delivery order and endorsed the same to his purchasers. The question was whether the transaction entered into by the dealer with third parties under which the endorsed delivery orders were transferred for a price amounted to 'sale of goods.' The point urged was that the sale of the delivery order cannot be taken to be 'sale of goods', and that as no goods had been appropriated to the contracts by the dealer with third parties before the delivery orders were endorsed, they will not amount to a sale of goods but were merely transfers of delivery orders as some paper. Their Lordships of the Supreme Court expressed the view that a delivery order is a document of title to goods, and the possessor of such a document has not only the right to take delivery of the goods but also has the power to transfer by endorsement for delivery. Even this decision proceeds on the basis that there was a sale transaction on the basis of which the delivery orders had been endorsed. But in the instant case there is no proof of any sale. Only if there is a sale transaction the question would arise whether the delivery of the goods effected by the tramway company to the firm would amount to two deliveries, one to M/s. Kuppuswami Naicker and Sons and the other from M/s. Kuppuswami Naicker and Sons to the firm. To invoke the principle laid down _ in that decision that two deliveries which are separate in point of fact and in the eye of law might synchronise in point of time, it should be shown that there are two sales. As already stated, we have absolutely no material to show that there was a sale from Messrs. Kuppuswami Naicker and Sons to the firm. If at all, there could have been only an assignment of the rights by M/s. Kuppuswami Naicker and Sons under the sale contract to the firm with the consent of the seller. But such an assignment of rights under the contract by itself will not come under the definition of 'sale' unless it is the result of a sale transaction. In this view we have to uphold the view taken by the Tribunal in this case.

11. The result is the tax case is dismissed with costs. Counsel's fee Rs. 150.