9911796707
TMI Blog1993 (11) TMI 209X X X X Extracts X X X X X X X X Extracts X X X X ..... is not leviable in the case of the petitioner,- (a) on goods other than electrical goods manufactured and sold by petitioner, (b) on goods imported from abroad, (c) on goods purchased by petitioner locally in Bangalore, and (d) on goods falling under entry 16B or 18 of the Schedule to the Act during the period covered by annexure E. Subsequently, petitioners by amending the writ petition sought for one more relief for quashing the assessment order dated March 14, 1988 (annexure J) and the notice of demand dated March 26, 1988 (annexure H). Petitioners point out that originally the Act provided for the levy of entry tax on textiles, tobacco and sugar up to March 31, 1982 and with effect from April 1, 1982, the Schedule was amended by the addition of 13 more items. There is no dispute that the articles/goods bought by the first petitioner are found in the Schedule with effect from April 1, 1982. But according to the petitioners, the first petitioner is not a "dealer" in those goods and those goods were used as inputs, etc., in the manufacture of electrical goods and the first petitioner's business is confined to the manufacture of the electrical goods and sale of those ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the registered dealer or dealer liable to be registered. The goods are to be scheduled goods. In the instant case, there is no dispute that goods are "scheduled goods" after April 1, 1982 and the basic question is whether the first petitioner is a dealer in the said goods. Section 28 in no way aids the contention of the petitioners, because, it declares that nothing in the Act shall apply to persons who are not dealers in scheduled goods. Similarly, the fact that inputs of industrial goods and other goods were specifically brought into the Schedule of the Act only after April 1, 1983, would not militate against the levy of the tax earlier, if the particular goods are found specifically in the Schedule earlier, as in the instant case. A scheduled goods, specified in the Schedule to the Act may have the quality of being used as an input in the manufacture of another goods; similarly, the fact that the term of "dealer" is now specifically defined in the Act as against the earlier provision, incorporating the definition of the term in the Karnataka Sales Tax Act, 1957, would not make any difference to the meaning attributable to that term earlier. The meaning of the term has to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he charging provision and a computation provision. And ordinarily the operation of the charging provision cannot be affected by the construction of a particular computation provision. But the question here is whether it is possible to apply the computation provision at all if a certain interpretation is pressed on the charging provision. That pertains to the fundamental integrality of the statutory scheme provided for each head." The learned counsel referred to sections 3(2) and 4(1) to contend that the liability to pay the tax is on the dealer in scheduled goods and this liability limits the scope of the charge under section 3. The contention certainly is quite sound and acceptable. But, the proposition behind this contention takes the petitioners nowhere, except to face the liability to pay the tax charged under section 3, unless, it is shown that the first petitioner is not a dealer in scheduled goods. To be a dealer in goods, it is not necessary that the said dealer should engage in the act of buying and selling in the same goods. It is true, the conservative meaning given to the term "dealer " requires such a person to engage in the act of buying and selling in the particu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cturing or selling a commodity, some other commodity which is not a by-product or a subsidiary product of that business and he sells that commodity, cogent evidence that he has intention to carry on business of selling that commodity would be required. Where a person in the course of carrying on a business is required to dispose of what may be called his fixed assets or his discarded goods acquired in the course of the business, an inference that he desired to carry on the business of selling his fixed assets or discarded goods would not ordinarily arise. To infer from a course of transactions that it is intended thereby to carry on business ordinarily the characteristics of volume, frequency, continuity and regularity indicating an intention to continue the activity of carrying on the transactions must exist." It was also held that intention to carry on business in the particular commodity must exist to hold the person as carrying on business in it. It was a decision rendered under the particular definition of the term "business" in the Bombay Sales Tax Act. In fact, several State laws were in similar terms. After a few judicial pronouncements, limiting the operation of the te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he charging provision of the Act gets attracted in respect of those goods when the taxable event stated in section 3 takes place. I may also refer to the decision of this Court in J.S. Auto Machine Shop v. State of Karnataka [1988] 70 STC 321; ILR [1988] 3 Kar 2510 cited by the learned Government Pleader, in support of the contention that a person need not sell the very article purchased by him to become a dealer and dealing in a machinery, which is a scheduled goods, attracted the levy under the Act. A few other contentions raised in the writ petition were not pressed in view of the settled position in law and therefore it is unnecessary to refer to them. However, Mr. Naganand contended that the petitioners had no adequate opportunity to place their several other contentions before the second respondent and they were not granted sufficient time to show cause against the proposition notice annexure "E" (dated March 1, 1988). It was also contended that the assessment order purported to bear the date March 14, 1988, was antedated to get over the interim order of stay made by this Court on March 22, 1988 and this is quite clear from the fact that the actual demand was issued only on ..... 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