Ayyangar, J. - (1.) These two appeals are before us by virtue of certificates of fitness granted by the High Court of Andhra Pradesh under Art. 133 (1) (c) of the Constitution. The State of Andhra Pradesh is the appellant in both the appeals and one Kolla Sreerama Murthy -a dealer in gunnies-is the respondent in each of them and the point involved relates to the liability of the respondent to Sales Tax in respect of the transactions to which we shall later refer.
(2.) Civil Appeal No. 368 of 1961 arises out of original suit No. 268 of 1951 in the file of the District Munsif's Court, Rajahmundry by the respondent for setting aside an assessment and obtain refund of a sum of Rs 2,941-7-0 which was partly the sum assessed and collected as sales-tax for the assessment year 1947-48, while Civil Appeal No. 369 of 1961 is from a similar suit praying for identical reliefs in respect of the year 1946-47, the amount of which refund was sought, however, being Rs. 1,631-12-0. The basis of the suits briefly was that the transactions whose turnover was included in his assessment, were not "sales of goods" within the Madras General Sales Tax Act (Act IX of 1939) and that consequently the assessment to tax and recovery of the same were illegal and without jurisdiction. Both the suits were decreed by the District Munsif-a decision which was affirmed by the Subordinate Judge of Rajahmundry on appeal by the State and by the High Court of Andhra Pradesh on further appeal also by the State. It is from these two judgments and decrees in the two second appeals that the present appeals have been brought.
(3.) It was common ground that the respondent was a "dealer" within the Madras Sales Tax Act (which for convenience we shall call the Act) being "a person who carries on the business of buying or selling goods," and that the transactions whose legal character is now in dispute were put through by him by way of business, Section 13 of the Act which is the charging section -enacts that "every dealer shall pay for each year a tax on his total turnover for such year." "Turnover" is defined in the Act as: "Turnover' means the aggregate amount for which goods are bought or sold or supplied or distributed, by a dealer either directly or through another, on his own account or on account of others whether for cash or for deferred payment or other valuable consideration provided that the proceeds of the sale by a person of agricultural or horticultural produce grown by himself or grown on any land in which he has an interest whether as owner, usufructuary mortgagee, tenant or otherwise shall be excluded from his turnover" and clauses (c) and (h) of S. 2 of the Act define "goods" and "sale" respectively thus: " 'Goods' means all kinds of movable property other than actionable claims, stocks and shares and securities and includes all materials, commodities and articles including those to be used in the construction, fitting out improvement or repair of immovable property or in the fitting out improvement or repair of movable property and also includes all growing crops grass and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale." "Sale with all its grammatical variations and cognate expressions means every transfer of the property in goods by one person to another in the course of trade or business for cash or for deferred payment or other valuable consideration and includes also a transfer of property in goods involved in the execution of a works contract, but does not include a mortgage, hypothecation, charge or pledge." The only matter, therefore, which is in controversy between the parties is as to whether the transactions to whose details we shall presently refer, which the respondent admittedly entered into, were or were not "sales of goods" within the Madras General Sales Tax Act (Act IX of 1939) so as to enable the turnover represented by these sales to be brought to tax under the Act.;