Business purchase for use in tanning services can attract sales tax even without resale of the goods.

A tannery that purchases tanning materials for use in rendering tanning services can fall within the statutory definition of "dealer" under the Madras General Sales Tax Act, 1959 where the purchases are part of an integrated business activity carried on for remuneration and profit motive. The fact that the materials are not resold as such does not exclude liability when the purchase is connected with the business and the charging scheme treats tanning materials as taxable at the last purchase point under the relevant schedule and rule. On that basis, the assessment on the purchase turnover of tanning materials was sustained.

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Issues: Whether a tanner who purchases tanning materials for use in rendering tanning services, and does not buy and sell those materials as such, is a "dealer" liable to sales tax on the purchase value of such materials under the Madras General Sales Tax Act, 1959.

Analysis: The statutory definition of "dealer" in section 2(g) requires business activity coupled with buying, selling, supplying or distributing goods in the course of business. "Business" in section 2(d) is an inclusive definition and is not confined to trade in the narrow sense. The petitioners carried on a tannery for remuneration and, in the ordinary course of that business, were required to buy tanning materials. The purchase of those materials was directly connected with the business operation and formed part of an integrated commercial activity carried on with profit motive. The fact that the petitioners did not themselves resell the tanning materials did not take them outside the charging scheme, particularly where Entry 59 of the First Schedule and Rule 5(2) fastened levy at the last purchase point on tanning materials.

Conclusion: The petitioners were dealers within the meaning of the Act and were liable to tax on the purchase value of the tanning materials.

Final Conclusion: The revision petition failed, and the assessment on the purchase turnover of tanning materials was sustained.

Ratio Decidendi: A purchase made in the course of a business with profit motive is taxable under the Act even if the purchaser does not also sell the goods purchased, so long as the activity falls within the statutory definition of dealer.

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