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TMI Blog1973 (7) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing authority took the view that the sales of such articles effected by the assessee are taxable. In that view, it determined the taxable turnover of the assessee for the years 1964-65 and 1965-66 at Rs. 8,06,627.88 and Rs. 9,62,012.25 respectively after rejecting the contention of the assessee that such sales are not in the course of carrying on of a business activity as contemplated by the provisions of the Madras General Sales Tax Act, 1959 (hereinafter called as the Act). The assessee thereafter appealed to the Appellate Assistant Commissioner, but without success. On further appeals to the Sales Tax Appellate Tribunal, the Tribunal held that the assessee is neither a dealer as defined in the Act nor does it carry on any business a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the course of business". The assessee is a statutory body constituted for the purpose of performance of certain statutory duties by the provisions of the Madras Port Trust Act, 1905. The preamble to the said Act sets out the object of the Act as regulation, conservancy and improvement of the Port of Madras. Section 39 of the Act sets out the service to be rendered by the Port Trust in relation to all goods received or taken custody of by the Port Trust, either in the course of export or in the course of import. Section 42 provides the scale of rates for and the conditions under which any of the services specified in section 39 are to be performed. Section 44 states that the prior sanction of the Central Government has to be obtained for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in the face of the amended definition of "business", unless the Port Trust is treated as a dealer carrying on the business of selling, supplying or distributing the goods as a commercial venture, its sales in the course of the exercise of its statutory duties are not assessable. Therefore, the sales of unclaimed or uncleared goods by the Port Trust cannot be considered as sales effected by a "dealer". Unserviceable goods said to have been sold by the Port Trust are old paper, iron scraps, containers, dismantled structures, old trucks, etc. The sales of such articles can of course be brought to charge by virtue of the amended definition of "business", if they have been effected by a dealer. But as already held the Port Trust cannot be c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and rents payable in respect of the goods, and that it was not the owner of the goods sold at any time. To make a person a dealer as defined in the Act, he must have sold the goods either as owner or as one who has been authorised by the owner to sell on his behalf. When the Port Trust sells the goods in respect of which it had a lien, it cannot be said to have effected the sales of the goods as a dealer. Suppose a pawn broker sells the articles pledged with him in default of the owner redeeming the articles as agreed with a view to recover the amounts advanced by him, can it be said that he is a dealer engaged in the business of buying and selling the articles? The answer can only be in the negative. In a recent decision in Tirumala Tiru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The case before us so far as it relates to unclaimed goods is an a fortiori one, for, in this case, the articles sold by the Port Trust did not belong to it unlike in the case dealt with in Tirumala Tirupati Devasthanam v. State of Madras[1972] 29 S.T.C. 266., where the articles sold belonged to the Devasthanam. In Andhra Pradesh State Road Transport Corporation v. Commercial Tax Officer, Hyderabad III[1971] 27 S.T.C. 42., the Andhra Pradesh High Court had held that the sales of scrapped vehicles, old tyres, old containers and other unserviceable materials effected periodically by the Andhra Pradesh Road Transport Corporation constituted under the Road Transport Corporation Act, 1950, were not taxable on the ground that the corporation w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... explanation (2) to section 2(g) of the Act. The said explanation is as follows: "The Central Government or any State Government which, whether or not in the course of business, buy, sell, supply or distribute goods, directly or otherwise, 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." According to the revenue, the Port Trust is a department of the Central Government and, therefore, even if the sales effected by it are not in the course of business, they are liable to be taxed, as the explanation deems a department of the Central Government or a State Government a dealer for the purpose of this Act. But we are not able to acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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