Dipak Kumar Sen, J. - (1.) This is a reference under Section 21(1) of the Bengal Finance (Sales Tax) Act, 1941, at the instance of Davy and United Engineering Co. Ltd., the assessee. The questions referred are as follows : (1) Whether or not transfers of goods by the applicant-company to other companies of the same consortium against payment of price constituted sales within the meaning of the Indian Sale of Goods Act and the Bengal Finance (Sales Tax) Act, 1941. (2) Whether or not sales of unserviceable goods, scraps, discarded and surplus materials were exigible to tax under the Bengal Finance (Sales Tax) Act, 1941, in view of the incorporation of the definition of "business" by an Ordinance promulgated in 1967 (since repealed and saved by West Bengal Act 25 of 1969), the retrospective operation of which was struck down by the Calcutta High Court in the case of Shew Bhagwan Goenka v. Commercial Tax Officer [1973] 32 S.T.C. 368.
(2.) The facts found and/or admitted are as follows : The assessee is a British company. It was engaged as a constituent of a consortium known as Incon. The consortium entered into a works contract with the Government of India in 1956 for the construction of the steel works at Durgapur. In terms of the said contract other members of the consortium used to obtain their supplies from the assessee by placing orders with the assessee for goods which were required in the construction as also for goods required for their own consumption. The assessee used to receive payments from the other members for such supplies. Also, during the closing years, the assessee disposed of a quantity of unserviceable, reject and surplus goods including furniture, motor vehicles, office equipments, etc., to outsiders.
(3.) The assessee at one time was registered as a dealer under the relevant Sales Tax Act. Assessments to sales tax were made on the assessee for the following periods prior to its registration as a dealer : 30th November, 1957, to 31st March, 1958, 1st April, 1958, to 31st March, 1959, 1st April, 1959, to 31st March, 1960, 1st April, 1960, to 30th June, 1961, 1st July, 1961, to 31st August, 1962, respectively on 20th September, 12th November, 14th December and 15th December, 1962. Being aggrieved by the assessments, the assessee preferred appeals before the Assistant Commissioner of Commercial Taxes who held that the assessee was rightly held to be a dealer in respect of sales made to the other members of the consortium. So far as disposal of fixed assets were concerned, the Assistant Commissioner held that the same should not have been included in the turnover of the assessee. Disposal of surplus stores was, however, held to be part of its turnover.;