Dealer status under sales tax law depends on business intention, not incidental disposal of surplus construction materials.

A person is a "dealer" under the Bombay Sales Tax Act only if the sale or supply of goods is carried on as a business in the commercial sense, with the object and intention of trading in those goods. Where a society manufactured bricks and procured steel mainly for its own construction needs, and disposed of surplus goods only incidentally at cost price, the transactions did not amount to carrying on the business of selling or supplying goods. The form of the accounts could not change the real character of the activity, and the absence of profit and trading intention was decisive.

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Issues: Whether the respondent society, having manufactured bricks and procured steel primarily for construction of its own buildings and having disposed of surplus goods, carried on the business of selling or supplying goods so as to be a dealer under section 2(c) of the Bombay Sales Tax Act.

Analysis: The definition of "dealer" is confined to a person who carries on the business of selling or supplying goods, and not merely one who occasionally sells or supplies goods. In a taxing statute, the expression "carrying on business" must be construed strictly and in a commercial sense. The decisive consideration is whether the activity is undertaken with the object and intention of selling or supplying goods as a business. On the facts found, the bricks and steel were procured to meet the society's own construction needs, and any surplus disposal was incidental, at cost price, and without a business intention to trade in goods. The form of accounts could not alter the real nature of the transactions. The absence of profit and the absence of an intention to sell when the goods were manufactured or imported strongly supported the conclusion that the society was not engaged in the business contemplated by the Act.

Conclusion: The respondent society was not a dealer within section 2(c) of the Bombay Sales Tax Act and the question referred was answered against the Revenue.

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