Single contract and local assembly do not establish business presence for sales tax dealer liability.

A person is treated as a dealer under the U.P. Sales Tax Act only if it is carrying on the business of buying and selling goods in Uttar Pradesh. On the facts, a single contract for supplying railway vans, with no branch, office, or workshop in the State and execution at Calcutta, did not amount to business carried on in Uttar Pradesh. Mere assembly of the vans at Izatnagar under railway facilities was insufficient, because business requires repetition or continuity of acts. The assessee was therefore not a dealer liable under the Act, and the reference was answered against the department.

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Issues: Whether the assessee, on the facts found, was a "dealer" and was carrying on the business of selling goods in Uttar Pradesh within the meaning of the U.P. Sales Tax Act.

Analysis: The reference turned on the statutory requirement that the assessee must be carrying on the business of buying and selling goods in Uttar Pradesh. The assessee had entered into only one contract for the supply of railway vans, had no branch, office, or workshop in the State, and the contract was executed at Calcutta. Mere assembly of the vans at Izatnagar under facilities provided by the railway authorities did not, by itself, establish a business carried on in the State. The reasoning emphasised that business requires repetition or continuity of acts, and a single sale or single contract ordinarily does not satisfy that test.

Conclusion: The assessee was not carrying on business in Uttar Pradesh and therefore was not a dealer liable under the Act. The question was answered against the department and in favour of the assessee.

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