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Report No. 61

1D.2. Co-operative societies.-

Co-operative societies furnish one example of such associations. In one of the earlier cases,1 decided by the Supreme Court, it was held that where there was nothing on record to show that the co-operative canteen was acting merely as an agent of its members (in providing facilities for making food available to the members), it could not be urged that the transaction was not a sale. It could not be said that the society was acting only as an agent or a trustee. A registered society is a body corporate with power to hold property etc. and the property which it holds cannot be assumed to be the property of the members.

The society is a juridical person, and the supply of refreshments by it for a price paid or promised results in a transfer of property in the refreshments. It could not, therefore, be urged as a proposition of law that when a co-operative society supplies, to its members, refreshments for a price under the scheme of distribution or supply of refreshments, the transaction can in no event be regarded as a sale.

1. Dy. C.T.O. v. Enfield India Ltd., AIR 1968 SC 833 (841, 842, 843), paras. 7 and 13: (1968) 2 SCJ 348.

Certain Problems connected with Powers of the States to Levy a Tax on the Sale of Goods and with the Central Sales Tax Act, 1956 Back

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