Isolated sale of spare parts does not make a hotelier a dealer in automobile parts for sales tax purposes.

An assessee running a hotel was found not to be a dealer in automobile spare parts merely because it sold spare parts received in settlement of accounts. The sale was a single, isolated transaction unconnected with the assessee's regular hotel business, and there was no basis to treat the assessee as carrying on a trading activity in motor parts. Rule 9(g) of the Kerala General Sales Tax Rules, which recognises exemption where the original dealer had sold the goods, also supported the view that the limited disposal did not create dealer status. Assessment on the turnover from that sale was therefore unjustified and illegal.

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Issues: Whether the assessee, a hotelier who sold automobile spare parts obtained in settlement of accounts, could be treated as a dealer in automobile parts so as to sustain assessment on the turnover from that sale.

Analysis: The sale of the automobile parts was found to be a single, isolated transaction unconnected with the assessee's regular business as a hotelier. The goods were not held as part of an established trading activity in motor parts, and the record did not justify treating the assessee as carrying on business in automobile parts. The availability of exemption in a case where the original dealer had sold the goods, as indicated by Rule 9(g) of the Kerala General Sales Tax Rules, reinforced that the assessee's limited disposal of the goods did not by itself make him a dealer in those goods.

Conclusion: The assessee was not a dealer in automobile spare parts, and the assessment on the disputed turnover was unjustified and illegal.

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