- (1.) THIS revision petition is directed against the order of the Deputy Commissioner, Sales Tax (Appeals), Jaipur, dated 20-10-59, whereby he rejected the appeal filed by the petitioners against the assessment order of the Sales Tax Officer, 'b' Circle, Jaipur, for the assessment year 1956-57.
(2.) IT has been averred that the assessee company is manufacturing steel balls, bearings and axle boxes for sale in the market and this is the only business of the Company. During the aforesaid assessment year, the assessee company sold scrap, coal dust and other unserviceable articles amounting to Rs. 17,612/12/ -. IT was stated that these sales did not form part of the regular business of the assessee company. This was in the nature of a casual sale and had no connection with the usual business of the company and that the company did not make any profit out of these sales. Notwithstanding the fact that the above sales did not form part of the regular business of the Company, the Sales Tax as Officer, Jaipur, imposed sales-tax in respect of these sales and the Company were unsuccessful in appeal also. Hence this revision petition. The learned counsel for the petitioners referred to my order in the Union of India through D. G. S. , Northern Railway Vs. The State (1964 RRD 257) in which I had held that it would not be appropriate to extend the definition of "usual business" to cover transactions relating to the disposal of unserviceable material and scrap. I had observed therein that it is not with a view to earning profits that this activity is resorted to, but it is with a view to reducing cost and releasing storage capacity that unserviceable material is disposed of now and then. As had been held earlier in the D. B. Ruling of the Board of Revenue in State of Rajasthan Vs. Asstt. Commercial Suppt. Lost Property, Northern Railway, Bikaner ( Revision No. 82 Bikaner St. 1962 dated 30-4-63), cited by me in the above case the words "carrying on business" connoted a continuous trade or occupation involving time and labour as also some investments, which may be regarded as an independent trade or occupation by itself capable of being sold or transferred as such. The principle underlying the distinction is that the transactions must be of a commercial nature and that business is a trade or profession at which one works regularly for profit. Judged by this standard, the disposal of unserviceable material and scrap would not fall within the definition of business. The learned counsel for the petitioners also drew my attention to the ruling given in Ambica Mills Ltd. Vs. State of Gujrat and another (XV Sales Tax Cases 1964 page 367) in which it was held by Their Lordship of the High Court of Gujrat that the sales which are amenable to tax under the Sales Tax Acts are not all sales, but those sales which can be said to have been effected as part of the business of the assessee or in the course of business activity. Where an assessee who is a registered dealer or one who is liable to be registered, has effected sales which are incidental to his normal business or sales of subsidiary products or by products arising out of his normal business, such sales would be considered as having been made in the course of his business. But the sale of stores and other sundry articles, which have become old and unserviceable, are not sales liable to sales tax. In the sales of such materials there cannot be any profit motive. These sales are only incidental to the business in the sense in which that expression is understood. Judged by this criterion, the conclusion is irresistible that the sale of unserviceable articles and scrap cannot be held liable to sales tax. The case of coal dust is, however, different. As was held by me in the Union of India through D. G. S. , Northern Railway Vs. The State referred to above, the case of disposal of coal ash could be easily distinguished from the sale of unserviceable material and scrap. Goal ash held to be the subsidiary product of the business of running the railways and its sale could be construed as an activity in the course of business. On the same analogy, the sale of coal dust by the petitioner Company must be deemed to be a subsidiary activity, the volume and frequency of which can be estimated with a considerable amount of certainty. This activity must, therefore, be deemed to be incidental to the normal business of the Company and such sales should be considered as having been made in the course of their business. In the result, therefore, I hold that while the sale of unserviceable articles and scrap is not liable to sales tax, the sale of coal dust cannot be exempted from the imposition of the sales tax. This revision petition is, therefore, partly accepted, so far as it relates to the sale of unserviceable and scrap. The assessee Company will now be reassessed in the light of the observations made above. Before parting with the case, I would like to observe that the practice has grown of not attaching the copies of the original orders with the revision petition. This must be enforced as provided under the rules. . ;