9911796707
TMI Blog1970 (12) TMI 79X X X X Extracts X X X X X X X X Extracts X X X X ..... to them and there being no motive of profit in such deals, the applicant could not be treated as a dealer in respect of such supplies and the same were not sales for the purpose of the Act. The Additional Commissioner of Commercial Taxes rejected this contention. The dealer then went to the Board of Revenue. The Board upheld the Additional Commissioner. Thereafter the applicant applied under section 21(1) of the Act to the Board of Revenue for reference to this court certain questions of law. The Board by its order dated the 24th December, 1962, observed as follows: "With regard to question No. 2, it is an admitted fact that the petitioner is a dealer. But the contention is that certain sales (of cokebreeze, stores etc.) made to the staff cannot be subjected to sales tax inasmuch as profit-motive was totally absent in these transactions. The Board appears to have held that although profit-motive might have been absent in the particular sale transactions, they nevertheless constitute sales within the meaning of the Bengal Finance (Sales Tax) Act, 1941, and that having been made by a dealer, they are to be subjected to sales tax. There is no authoritative decision on this question, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e real dispute between the parties. Mr. Sen Gupta, learned counsel for the respondent, has urged that before the departmental authorities it was never argued that coke-breeze and stores were supplied to employees to provide them with social amenities and, as such, this court should not enter into this controversy or reframe the question referred to it for settling an issue of this nature. Mr. Sen Gupta is right that from the order of the Commercial Tax Officer it does not appear that the dispute we have indicated was raised or considered by him (vide pages 4 to 6 of the paper-book). But at pages 11 and 12 we find the grounds of appeal against the order of assessment under section 11 of the Bengal Finance (Sales Tax) Act. Ground No. 2 is: "That the charges of Rs. 42,314 realised for coke-breeze supplied to the employees at concessional rate cannot form part of your petitioner's turnover because such supplies were effected not with a view to do the business of selling." Ground No. 7 is: "That the charges of Rs. 1,372 realised for goods supplied to staff mostly at nominal price and at cost cannot form part of your petitioner's turnover because such supplies were effected not wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not effected with a view to do the business of selling. The same points were taken also in the grounds of application for revision under section 23 [vide grounds 2(a) and 2(c) at page 32 of the paperbook] but the Additional Member, Board of Revenue, it appears, has not dealt with these issues at all. The Supreme Court in Commissioner of Income-tax, Bombay v. Scindia Steam Navigation Co. Ltd.[1961] 42 I.T.R. 589 (S.C.). has been pleased to lay down that when a question of law is raised before the Tribunal but the Tribunal fails to deal with it, it must be deemed to have been dealt with by it, and is, therefore, one arising out of its order. We are of the opinion that these principles apply to the proceedings before the sales tax authorities in the instant reference. And in order to bring out the real controversy between the applicant and the respondent the question referred to us should be reframed as follows: "Whether the sales by the petitioner to the members of its staff of certain commodities, such as coke-breeze and stores, should be excluded from its turnover as 'dealer' for the purpose of imposition of sales tax under the Bengal Finance (Sales Tax) Act, 1941, and thus be e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... basic condition of trade, commerce or manufacture or adventure or concern remains and all that it says is that 'such trade, commerce, manufacture, adventure or concern' may or may not be carried with the motive to make profit. Unless, therefore, the turnover relates to trade, commerce, manufacture, adventure or concern there can be no question for its attracting a tax under the Bengal Finance (Sales Tax) Act simply on the ground that it is without profit and that such absence of profit-motive is not a sufficient ground for exemption. If the thing itself is not basically trade, commerce, manufacture, adventure or concern then no further question of the motive for profit or not making a profit arises. The basic test of trade, commerce, manufacture, adventure or concern must be satisfied before any tax can be attracted. Once the basic test is satisfied the further fact that it was not carried on with the motive to make a profit will not matter and will not grant an exemption." The unmistakable trend of these authorities is that a person cannot be a "dealer" under the Bengal Finance (Sales Tax) Act unless he carries on the business of selling goods in a commercial sense. In other wor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Enfield India Ltd., were supplied in the course of the trade or business of the society and the proceeds realised by such sales were taxable under the relevant statute. The four tests of the Supreme Court were suggested, in our view, against the background of these facts. Moreover, in the explanation to section 2(g) of the Madras Sales Tax Act of 1959, it is clearly stated: "A society (including a co-operative society), club or firm or an association which, whether or not in the course of business, buys, sells, supplies or distributes goods from or to its members for cash, or for deferred payment, or for commission, remuneration or other valuable consideration, shall be deemed to be a dealer for the purposes of this Act." This shows that the facts in the Madras case were widely different from the facts we are dealing with in this reference. In these premises, we are of opinion that the applicant was not a "dealer" in the relevant assessment year in respect of coke-breeze and stores and our answer to the reframed question is in the affirmative and in favour of the applicant. Each party will bear and pay its own costs. Roy, J.-I agree. Reference answered in the affirmati ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
