- (1.) THIS is a revision filed by the State against the order of the Deputy Commissioner (Appeals), Jaipur, dated 30-7-1965, whereby he had accepted two appeals filed by M/s Heerlal, Contractor, against the assessment order of the Assistant Sales Tax Officer, Ajmer City, in respect of assessment periods 1958-59 and 1959-60.
(2.) THE facts of the case in brief are that the opposite party purchased coal ash from the Western Railways. THE assessing authority assessed this sale on the ground that this is payable in the hands of the opposite party as the Divisional Engineer, Railways, who sold the coal-ash was exempt from its payment. On an appeal filed in the court of the Deputy Commissioner, Commercial Taxes (Appeals), the assessment was set aside on the ground that since the non-petitioner had purchased this coal-ash from the District Electrical Engineer, Western Railway, Ajmer, who was a a registered dealer at No. 260/56 with the Ajmer Sales Tax authorities, the tax was payable by him and not by the non-applicant. Aggrieved by this order, a revision has been filed in this Court. It was urged by the counsel for the applicant that since the Railways could not be registered dealer, the tax was leviable only from the opposite party, on the authority of 1966 S. T. C. at page 235, in which it was held that sales tax in respect of sales of goods belonging to the assessee effected in the year 1955 by his commission agent, who had been exempted under sec. 4 (2) of the Rajasthan Sales Tax Act, 1954, was leviable on the assessee inasmuch as the assessee as dealer under the Act effected the sales thereof through his exempted commission agent. It was further urged that if registration certificate was given wrongly in the name of the Divisional Engineer, Railways, the Government should not suffer. The liability for payment of sales tax came to Railways from 1962 and not earlier. It was contended by the counsel for the non-applicant that since the Divisional Engineer, Western Railways, was a registered dealer, tax should be leviable on him as tax on coal ash is payable on the first point. The question for consideration is whether the Railways or any of their subordinate officers could be said to be a dealer within the meaning of sec. 2 (f) of the Rajasthan Sales Tax Act, 1954. This question has been also previously dealt in a number of cases, but no unambiguous rule appears to have emerged. It would, therefore, be worthwhile to examine in detail the law on the point, with reference to the years 1958-59 and 1959-60, which are relevant for the disposal of this case. The word "dealer" as defined in sec. 2 (f) of the Act reads as a under:" "2 (f) - "dealer" means any person, we carried on the business of selling or supplying goods in the State whether on commission or for remuneration or otherwise and includes "the State Government in respect of any such business", a Hindu undivided family, and also a society, club or any other association which, sells or supplies goods to its members. " To my mind the operative part of the definition is the carrying on the business; of selling or supplying goods in the State whether on commission or otherwise. The phrase "and includes the State Government in respect of any such business" only amplifies the operative part, laying emphasis on the fact that merely because a department is a State department it would not be excluded from the definition of a dealer if it carries the business of selling or supplying of goods. To my mind, even if the phrase "and includes the State in respect of any such business" did not form part of this definition, any department of a State carrying on the business of selling or supplying of goods will be covered within the definition of a dealer. Similarly, if the phrase "central Government or any departments under it" were excluded from this definition (the phrase was added in subsequent amendment in 1960), it will be covered within the definition of a dealer, provided it carries on the business of selling or supplying of goods The main yardstick is the carrying on the business of selling of goods, Unless the Central Government or the State Government were expressly excluded from this definition, they would be deemed to be dealers if carrying on such business. The addition of the phrase "and includes State Government or the Central Government and its offices" was simply to avoid any contingency of any assessing authority not bringing them within the meaning of the word "dealer", if they happen to carry on the business of selling or supplying goods. Both the Central Government and the State Government were juridical persons. Now the Central Government or the State Government have a number of departments. Most of them do not carry on any business of supplying or selling of goods, but some of them do. It will be wrong to bring the Central Government or the State Government as such, within the definition of a deale. But it will be equally wrong not to bring such of the Departments of the Central or the State Governments within the definition of dealer as are carrying on the business of supplying or selling the goods. " The same issue arose in a previous case before a Division Bench of this Board ( D. S. Northern Railway, Jodhpur vs. The State of Rajasthan in Revision No. 59/jodhpur of 1961 R. L. W. 1962 Revenue Supplement page ). The question posed therein was whether the Northern Railway while buying and selling coal ash could be covered within the definition of the word 'dealer'. It was contended in that case on behalf of the Northern Railway that the activity of the Northern Railway was mainly the transportation of passengers and carrying of goods. It therefore could not be said that their business consisting in the disposal of the coal ash could be styled as business of selling and buying coal-ash. A number of authorities such as A. I. R. 1954 Madras page 954, 1950 Bombay page 673, and A. I. R. 1957 Assam page 179, were discussed in that case. The principle deduced from these authorities was that if the business of selling or supplying goods is in the nature of continuous trade or occupation involving time and labour, as also investments, which may be regarded as an independent trade or occupation by itself capable of being sold or transferred as such, it will come within the definition of a business of selling and supplying goods. The learned Members of that Bench thought that an apposite ruling in that case was A. I. R. 1962 Kerala page 4, in which the question arose for determination whether a firm dealing in daily products was liable to pay tax on the sale of cattle that became unserviceable. It was held that the liability could not be denied. The learned Members held that the main business of the Northern Railway, undoubtedly, was the transportation of persons and goods, but in the course of this main business, a byproduct in the form of coalash was produced which was a regular, recurrent feature, and so was its sale and not a chance of a fortuitous activity. By making commercial calculations of the costs or investment, the Railways must be taking into account their income from the sale of coalash. In my opinion, the rule laid down in the aforesaid case is unexceptionable and it cannot be denied that the Railways in the business of selling coal-ash, which is a regular business, must be covered within the definition of "dealer". They are not excluded by any law for the time being in force. In another case State of Rajasthan v/s Assistant Commercial Superindent, Lost Property, Northern Railway, Bikaner (Revision No. 82/bikaner-S. T. /1962), a similar question Was considered by another Bench of the Board. In that case the issue was whether the sale of lost property by the Northern Railway could be covered under the definition of "selling or supplying goods". The Bench decided that the disposal of lost property by the Railway administration was not a business of buying or selling or supplying goods. The question whether the Northern Railway should be a dealer or not was incidentally also considered, and by juxa-posing the later version of sec. 2 (f) of the Rajasthan Sales Tax Act, 1954, is was observed that a clear, inference could be drawn that at the time the expression 'dealer' did not include the Central Government. In my opinion, the aforesaid judgment is only relevant for the rule that the disposal of lost property by the Railway administration was not a business of buying, selling or supplying goods. As remarked by me above, there may be number of departments of Central or the State Governments which may be buying or selling or supplying goods, and the question whether the State Government or the Central Government would be a dealer or not is not a proper question. The Northern Railway would certainly not be a dealer as far as the sale of lost property is concerned, as this sale would not be a continuous trade or occupation involving time and labour, as also some investment, which may be regarded as an independent trade or occupation by itself, capable of being sold or transferred as such, like the coal ash. The second conclusion of this Bench seems to me in the nature of an obiter dicta, as 1 have stated above the yardstick to determine whether a particular department of the State Government or the Central Government would be a dealer or not is its regularly continuing the business of buying or selling or supplying of goods. The reason that in 1960 the Central Government was also included specifically in the definition of dealer cannot be construed to mean that prior to 1960 because they were not included, they were not included, they were excluded. As I have stated above, the inclusion of the State or the Central Government in the context of the words used in defining a 'dealer' only amplifies its meaning. Even if this specific inclusion would not be there, any department indulging in the business of buying, or selling, or supplying of the goods would be a 'dealer'. I, therefore, think that the learned Deputy Commissioner (Appeals) was right in holding that the District Electrical Engineer, Western Railway, Ajmer, who sells coal ash in the regular course of his business is a dealer within the meaning of sec. 2 (f) of the Act as it existed in the years 1958-59 and 1959-60. As the respondent was a second dealer, the coalash was not taxable in his hands. I, therefore, see no force in this revision and reject the same. . ;