Profit motive required for sales tax business classification; dealer liability could not stand without proof of earning intent.

For the pre-amendment sales tax regime, trading activity counted as business only if carried on with a profit motive; volume, frequency, continuity and regularity alone were insufficient. The Revenue had to prove that element before fastening dealer liability, and on the material described it did not discharge that burden because the assessee consistently maintained a no profit-no loss basis and no adequate inquiry or finding on profit motive had been made. The assessments were therefore unsustainable and were set aside.

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Issues: Whether the assessee's sales of medical stores on a no profit-no loss basis constituted business so as to make it a dealer liable to tax under the Assam Finance (Sales Tax) Act, 1956 and the Central Sales Tax Act, 1956, and whether the assessments made on that basis could stand.

Analysis: For the relevant pre-amendment period, the statutory concept of business required a profit motive. Mere volume, frequency, continuity, and regularity of transactions were not enough if the activity lacked the motive of earning profit. The assessee had consistently asserted that supplies were made on a no profit-no loss basis, and the Revenue produced no material to disprove that position. The burden lay on the Revenue to establish profit motive, and no adequate inquiry or finding on that aspect had been made before assessment. In these circumstances, the request for remand was declined, especially as the relevant years were long past and records were unavailable.

Conclusion: The assessee was not shown to be carrying on business with profit motive and was therefore not liable to be treated as a dealer on the material before the authorities. The assessments could not be sustained and were liable to be quashed.

Final Conclusion: The appeals succeeded, the High Court's decision was reversed, and the assessments for the period in question were set aside.

Ratio Decidendi: For the pre-amendment sales tax law, transactions are not business unless they are carried on with a profit motive, and the Revenue bears the burden of proving that element before fastening dealer liability.

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