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TMI Blog1985 (4) TMI 278X X X X Extracts X X X X X X X X Extracts X X X X ..... and notice (annexure P-4) from the Conservator of Forests, Himachal Pradesh (appellant No. 3), under the Himachal Pradesh General Sales Tax Act, 1968 (hereinafter the Act), requiring the payment of sales tax on the auction amount. The respondent had denied the liability to pay the tax. It was alleged that the demand was illegal and against the provisions of section 13 of the Act. The goods sold to him were not ascertained and the property in the goods did not pass to the purchaser till the forests were exploited. It was alleged that the appellants were not dealers and the standing trees were not goods. In short, the respondent challenged the demand notice and the authority of the appellants to claim the tax. The appellants denied the various allegations of the respondent. The appellants also raised preliminary objections such as (a) the Excise and Taxation Commissioner, Himachal Pradesh, was a necessary party, (b) the dispute was liable to be decided by an arbitrator and the disputes between the parties were arising out of contractual obligations. The learned single Judge found that the Excise and Taxation Commissioner, Himachal Pradesh, was not a necessary party, the writ juri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nambiguous provision to the contrary. It is an admitted position that a State Legislature is empowered to give retrospective effect also. The learned single Judge has held: "The forest department is not a 'dealer' since it does not deliver the goods for the purpose of consumption in the Union Territory of Himachal Pradesh. There is no condition in the agreement which enjoins that the goods are delivered or sold to the petitioner for the purpose of consumption in the Union Territory of Himachal Pradesh. That being so the forest department or the Chief Conservator of Forests or the Conservator of Forests cannot be said to be dealers. within the meaning of section 2(c) of the Act." Now, section 2(c) of the Act prior to the Amedment Act reads as follows: "'dealer' means any person including a department of Government who in the normal course of trade sells or purchases any goods that are actually delivered for the purpose of consumption in the State of Himachal Pradesh, irrespective of the fact that the main place of business of such person is outside the said territory and where the main place of business of any such person is not in the said State, dealer includes the local m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by whatever name called, and whether of the same description as hereinbefore mentioned or not, who carries on the business of buying, selling, supplying or distributing goods belonging to any principal, whether disclosed or not; and (iii) an auctioneer who carries on the business of selling or auctioning goods belonging to any principal, whether disclosed or not, and whether the offer of the intending purchaser is accepted by him or by the principal or a nominee of the principal. Explanations.-(1)....................................... (2) A Government which whether or not in the course of business, buys, sells, supplies or distributes goods, directly or otherwise, for cash or for deferred payment or for commission, remuneration or other valuable consideration, shall, except in relation to any sale, supply or distribution of surplus, unserviceable or old stores or materials or waste products or obsolete or discarded machinery or parts or accessories thereof, be deemed to be a dealer for the purpose of this Act. (3) For the purpose of this clause "Government" shall include the Central Government or the Government of any other State or Union Territory." (c) for clause (e), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rce, manufacture, adventure or concern is carried on or undertaken with a motive to make gain or profit and whether or not any gain or profit accrues therefrom; and (ii) any transaction in connection with, or incidental or ancillary to, such trade, commerce, manufacture, adventure or concern." Further in [1976] 38 STC 577 (SC); AIR 1976 SC 1813 (Board of Revenue v. A.M. Ansari) reliance was placed upon [1967] 19 STC 1 (SC); AIR 1967 SC 1066 (State of Gujarat v. Raipur Manufacturing Co. Ltd.) for interpreating the word "business". [1967] 19 STC 1 (SC); AIR 1967 SC 1066 (State of Gujarat v. Raipur Manufacturing Co. Ltd.) was under the Bombay Sales Tax Act and in the Bombay Sales Tax Act the word "business" was not defined. In these circumstances, it is observed that to find out as to whether a person carries on business in a particular commodity must depend upon the volume, frequency, continuity and regularity of transactions of purchase and sale in a class of goods and the transactions must ordinarily be entered into with a profit-motive. It was further observed that when a subsidiary product is turned out in the factory of the assessee regularly and continuously and it is being ..... X X X X Extracts X X X X X X X X Extracts X X X X
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