Atar is found arguring with Ainethach, who refuses to sell his mine to the Silver-Bloods. Atar claims he was sent by the Silver-Bloods who so "generously" wanted to protect the mine from the Forsworn and, in their "generosity", want Ainethach to sell it to pay for their services.
If the Dragonborn talks with Ainethach first, Atar will be inside the mine. He can be asked to leave, or the Dragonborn can tell him that he or she can convince Ainethach to sell.
He will normally appear at the Silver-Blood Inn in Markarth after the dispute is solved (assuming he wasn't killed). However, he may not appear if Kolskeggr Mine hasn't been cleared yet, since his journey will be interrupted by the Forsworn there.