Expanded definition of business brings sale of a staff car into taxable turnover, while prior binding precedent preserved motor spirit exemption.

Sales of motor spirit after repeal of the M.S.T. Act, 1957 were treated as exempt from levy under the M.P. General Sales Tax Act, 1958 because the point was already covered by an earlier binding Division Bench ruling; section 54 was likewise held inapplicable on the same statutory footing. By contrast, the sale of an old staff car was held taxable under the amended definition of "business", because an asset acquired and used in connection with business falls within taxable turnover even if the assessee does not trade in such assets. Costs were left to lie where they fell.

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Issues: (i) Whether sales of stock of motor spirit, after repeal of the M.S.T. Act, 1957, were exempt from levy under the M.P. General Sales Tax Act, 1958. (ii) Whether section 54 of the M.P. General Sales Tax Act, 1958 applied for claiming such exemption. (iii) Whether sale of an old staff car formed part of the assessee's "business" and was liable to tax.

Issue (i): Whether sales of stock of motor spirit, after repeal of the M.S.T. Act, 1957, were exempt from levy under the M.P. General Sales Tax Act, 1958.

Analysis: The question was treated as already concluded by an earlier Division Bench decision on the same point. The statutory scheme concerning the post-repeal position of motor spirit sales had been considered with reference to the relevant fiscal and saving provisions.

Conclusion: Decided in favour of the assessee and against the department.

Issue (ii): Whether section 54 of the M.P. General Sales Tax Act, 1958 applied for claiming such exemption.

Analysis: This question also stood covered by the prior binding decision on the same statutory setting and was not treated as a fresh issue requiring separate departure from that view.

Conclusion: Decided in favour of the assessee and against the department.

Issue (iii): Whether sale of an old staff car formed part of the assessee's "business" and was liable to tax.

Analysis: The amended definition of "business" was applied to determine whether disposal of a vehicle used in connection with the assessee's commercial activities could enter taxable turnover. The decisive consideration was not whether the assessee traded in old cars, but whether the asset had been acquired and used in connection with the business. As the staff car was meant for business use and not personal use, its sale fell within the widened statutory concept of business.

Conclusion: Decided in favour of the department and against the assessee.

Final Conclusion: The reference was answered by upholding exemption on the motor spirit questions in favour of the assessee, but sustaining taxability of the sale of the staff car in favour of the department, with costs left to be borne by the parties themselves.

Ratio Decidendi: Under the amended definition of business, sale of an asset acquired for use in connection with business is taxable even if the assessee does not deal in that asset as stock-in-trade, whereas sales governed by an earlier binding answer on the same statutory issue must follow that answer.

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