Profit motive in sales tax business activity extended to fertiliser distribution under a seeding programme, making the transactions taxable.

Business activity for sales tax purposes depends on whether the person carries on buying or selling goods with a profit motive, even if no immediate profit is shown. The High Court treated the petitioner's distribution of fertilisers under the seeding programme as part of the same commercial activity as its regular sales, noting that a distributor's margin existed up to 1 August 1974 and that later operations were intended to build an infrastructure and market network for future profit. The Court distinguished authorities dealing with different commodities, discarded goods, or a different statutory definition. It concluded that the petitioner was a dealer in the relevant transactions and the transactions were taxable.

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Issues: Whether the petitioner was a "dealer" within the meaning of the sales tax law while distributing fertilisers under the seeding programme operations, so as to attract tax on those transactions.

Analysis: The definition of "dealer" turned on whether the person carried on the business of buying or selling goods. The Court applied the settled principle that business activity is ordinarily characterized by a course of dealings undertaken with a profit motive, though actual profit need not be shown. Here, the petitioner's main activity was the distribution and sale of fertilisers, and the programme transactions were of the same character. Up to 1 August 1974 a distributor's margin was in fact provided, and even thereafter the activity was undertaken to build an infrastructure and market network for future profits. The Court held that the absence of immediate profit did not ate profit motive, and the activity remained business activity. The decisions relied upon by the petitioner were distinguished on the basis that they involved different commodities, discarded goods, or a statutory definition that then required profit motive in a different context.

Conclusion: The petitioner was carrying on business in the relevant transactions and was a dealer; the answer is against the petitioner.

Ratio Decidendi: An activity amounts to business for sales tax purposes when it is part of a course of dealings undertaken with a profit motive, and the absence of immediate profit does not prevent a transaction from being business if it is carried on to secure future commercial advantage.

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