Forest produce sales from plantation land count as business turnover when commercially exploited as part of the venture.

Forest produce sold after clearing land acquired or leased for plantation development was treated as part of business turnover and subjected to sales tax. The Court noted that the assessees acquired large forest tracts for commercial plantation use, intended from the outset to dispose of standing trees to best advantage, and processed the produce into timber, sleepers and charcoal over time. Because the sales were incidental or ancillary to the commercial venture, and business under the statute extended beyond direct trade or manufacture, the proceeds formed taxable turnover even though profit motive was not decisive.

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Issues: Whether the sale proceeds from firewood, timber, sleepers and charcoal obtained by clearing forest land acquired or leased for plantation purposes formed part of the assessee's business turnover and were liable to sales tax.

Analysis: The activities were not treated as a mere realisation of capital assets. The acquisition or lease of large forest tracts for plantation purposes necessarily involved clearing trees over time, and the assessees intended from the outset to dispose of the standing trees to the best advantage. The lease deed in one case also referred to development and exploitation of the lands. The disposal of forest produce was carried out in a commercial manner, over a period of years, by sawing timber, converting some into sleepers, and making charcoal. Under the statutory definition, business includes not only trade, commerce or manufacture but also transactions incidental or ancillary thereto, and the concept of dealer extends to such business activities even if profit motive is not decisive.

Conclusion: The sales of forest produce were part of the assessees' business and were taxable as turnover under the Act.

Final Conclusion: The appellate court restored the assessments by holding that the forest produce sales were integral to the commercial venture undertaken for plantation development.

Ratio Decidendi: Where forest land is acquired or leased for plantation development and the standing trees are intentionally and commercially exploited as part of that venture, the sale of such produce is an incidental or ancillary transaction in the course of business and forms part of taxable turnover.

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