1985 (8) TMI 324

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....hort point raised in these appeals by special leave directed against the judgment of the Gauhati High Court is as to whether the assessee-appellant is liable to be taxed under the Assam Finance (Sales Tax) Act, 1956 ("State Act" for short) and the Central Sales Tax Act, 1956 (Central Act). When assessments were completed under the two Acts in spite of the resistance of the assessee which took the stand that it was not a dealer and, therefore, was not liable to tax, writ petitions were filed before the High Court challenging the demands by contending that the appellant was not a dealer and the certificate of registration issued to it without any application on its behalf should be cancelled and the demands should be quashed. The appellant....

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....mmercial nature and the Depot functions only as a distribution centre with the sole object of ensuring the supply of pure drugs and medicines at lesser prices than available in the market to the Central and State Government institutions within the State of Assam and other neighbouring places. The appellant did not apply for registration in view of its stand, but the Superintendent of Taxes got the appellant registered under section 7(1) of the State Act with effect from December 1, 1965 and also treated it to be a dealer under the Central Act. Assessments followed under both the Acts overruling the appellant's stand whereupon the writ petitions as indicated were filed. Before the High Court the appellant reiterated its stand that, as ....

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.... and regularity. The High Court, however, held: "It is difficult to hold that the Government of India in this case is absolutely regardless of the question of possibility of profit rather than loss. The very formula 'No profit-No loss' clearly points to earning of some profit and certainly not incurring of loss in the course of the transactions which are organised, systematic and regular. The very fact the Government keeps a watch and if required revises the formula of rate fixation and the levy of departmental charges would also go to show that the Government never intended not to earn minimum of profit in these transactions of sales," And proceeded to dismiss the writ petitions by saying: "Be that as it may, for the reasons given....

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.... the cost price along with a further sum to cover handling expenses. It took the stand before the sales tax authorities that the supplies to contractors on recovery of price together with the extra sum did not constitute business. This Court referred to its earlier decision in the case of State of Andhra Pradesh v. Abdul Bakshi & Bros. [1964] 15 STC 644 (SC), where it had said: "The expression 'business' though extensively used is a word of indefinite import. In taxing statutes it is used in the sense of an occupation, or profession which occupies the time, attention and labour of a person, normally with the object of making profit. To regard an activity as business there must be a course of dealings, either actually continued or contemp....

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.... respondents on two decisions one of this Court and the other of the Punjab and Haryana High Court. In Deputy Commercial Tax Officer, Saidapet, Madras v. Enfield India Ltd. Co-operative Canteen Ltd. [1968] 21 STC 317 (SC), the question for consideration was whether a members' co-operative society supplying refreshments was a "dealer" under the Tamil Nadu Sales Tax Act. In the definition of "dealer", the explanation specifically brought in a co-operative society and expressly provided that whether or not in the course of business if it supplied goods to its members it became a dealer. Keeping the said definition in view the decision went in favour of the Revenue. That would not be an authority relevant for our present purpose. In Governme....

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....n made by the respondent into this aspect when it made the assessments. Nor was the High Court called upon to record such a finding on the basis of any material placed and the respondent remained satisfied by pleading a bare denial to the assertion in the writ petitions supported by the scheme and its terms. Mr. Ahuja for the respondents strenuously pleaded that the matters should go back and the respondents would be given an opportunity of determining the question as to whether the transactions had been carried on with any profit-motive. We are concerned with the years 1965-68. About two decades have already rolled by. We may point out that at the instance of Mr. Ahuja we had called upon the appellant to produce its record and appellant's ....