Inclusive definition of business makes sale of discarded stores taxable when disposal is incidental to business activity.

Under the enlarged and inclusive definitions of "business" in the M.P. General Sales Tax Act, 1958 and the Central Sales Tax Act, disposal of unserviceable stores was treated as part of business activity when the items had been procured for use in the business and were sold after wear and tear. Such sales were not casual or isolated transactions, and the absence of actual profit did not affect taxability. The sale of discarded scrap, dyes, chemicals, broken iron hoops, obsolete machinery and coal-ash was therefore held to be a sale in the course of business and liable to tax.

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Issues: Whether the sale of unserviceable items of stores comprising discarded assets such as scrap, dyes, chemicals, broken iron hoops, obsolete machinery and coal-ash was a sale in the course of business and therefore exigible to tax.

Analysis: The definition of "business" under the M.P. General Sales Tax Act, 1958 and the Central Sales Tax Act was of an enlarged and inclusive character, extending not only to trade, commerce or manufacture but also to transactions connected with, incidental to, or ancillary to such business. The discarded items had been procured for use in the assessee's business, and their disposal after wear and tear was part of the normal business process. Such sales were not casual or isolated transactions outside the business activity, and absence of actual profit did not affect taxability under the inclusive statutory definition.

Conclusion: The sale of the unserviceable stores was held to be a sale made in the course of business and was liable to tax. The question was answered in the affirmative, in favour of the Revenue and against the assessee.

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