Commercial character of sales activity determines dealer status; incidental profit from religious book sales did not make the society a trader.

A society engaged in printing, publishing and distributing Christian literature was held not to be carrying on business of a commercial character under the Madras General Sales Tax Act. Continuous sales and the existence of profit did not, by themselves, make the activity a trading venture where the dominant object remained religious publication and distribution, and the use of ordinary business methods did not alter that character. Sales of religious books were therefore not shown to be transactions in the course of trade or commerce, and the assessment orders could not stand.

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Issues: Whether a society engaged in printing, publishing and distributing Christian literature, and selling religious books at a profit, is a dealer within the meaning of the Madras General Sales Tax Act.

Analysis: The definition of dealer under section 2(g) contemplates not merely buying and selling of goods, but business of a commercial character. A continuous course of sales or the existence of profit does not by itself establish that the activity is business for sales tax purposes. The dominant object of the society was printing, publishing and distribution of Christian literature, and the use of normal business means to achieve that object did not convert the underlying activity into a commercial venture. On that footing, the sales of religious books were not shown to be transactions in the course of trade or commerce.

Conclusion: The society was not a dealer within the meaning of the Madras General Sales Tax Act, and the assessment orders could not stand.

Ratio Decidendi: For sales tax liability, the activity must be essentially commercial in character; profit-making sales incidental to a non-commercial religious or charitable object do not, by themselves, constitute carrying on the business of buying or selling goods.

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