TMI Blog1957 (7) TMI 33X X X X Extracts X X X X X X X X Extracts X X X X ..... cause why he should not be so registered. The petitioner showed cause stating, inter alia, that he was not a dealer, as defined in section 2(3) of the Act, and that he did not carry on any business of selling or supplying goods, as defined in the Assam Sales Tax Act. The disposal of the sal trees in the manner indicated earlier, according to the contention of the petitioner, did not attract the provisions of the Act. He further asserted that the disposal of standing sal trees was, in effect, disposal of immovable property, and, as such, beyond the scope of the Act. The Superintendent of Taxes, however, insisted that the petitioner should get himself registered as a dealer. The petitioner then filed a written objection before that officer reiterating the grounds mentioned above. The objection was not entertained by the officer as he persisted in the view that the petitioner was liable to be taxed under the provisions of the Act, and, by his letter, dated 6th February, 1954, called upon the petitioner to apply for registration, and also to submit returns for various periods beginning from 31st March, 1951, and ending with 30th September, 1953. The officer further observed that in cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een observed that an application for a writ under Article 226 of the Constitution should not be allowed to short-circuit the procedure which is laid down under the Sales Tax Act itself. The appropriate remedy for the party concerned is to follow the procedure provided by the Act itself, and if he fails to avail himself of it, the High Court would not interfere under Article 226 of the Constitution. The learned Advocate-General also refers to the judgment of the Supreme Court in the well known case of Bengal Immunity Co., Ltd. v. State of Bihar(1) and contends that even if a remedy were available to the petitioner under Article 226 of the Constitution, it could be only available where the constitutionality of the legislation itself was in question, and that where the vires of the legislation is not in question, there is no reason why the petitioner should not be compelled to seek his ordinary remedies under the Act itself. The decision in the Bengal Immunity case[1955] 6 S.T.C. 446; A.I.R. 1955 S.C. 661. in our opinion, does not help the contention of the learned counsel. It is true that, in that case, the vires of the legislation itself was canvassed on the ground that the said A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, is ultra vires that law. The learned counsel for the petitioner has further submitted that the proceedings in this case were initiated by a notice served under section 10 of the Act on 14th September, 1953, whereas the amended provisions of section 32 of the Act were introduced by Assam Act XII of 1954. He, therefore, submits that there could be an objection raised against him on the ground that the petitioner could not have the advantage of that section. It is well settled that in appropriate cases, the High Court can always interfere by prerogative writs where it finds that manifest injustice is likely to result from unauthorised and unwarranted acts of the taxing authorities which are not sanctioned by the law: See Behubar Co., Ltd. v. Commissioner of Taxes [1957] 8 S.T.C. 417; A.I.R. 1957 Assam 61. It was also held in Hanuman Prasad Agarwalla v. Rabindralal BaruaA.I.R. 1956 Assam 114. , that although, by the amendment of section 32, a remedy, by way of reference, had been provided for, the assessment order in that case was governed by the Act of 1947 independently of the changes made in 1954, and, on the terms of section 32, as it then stood, no reference lay. In the circu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessed extensive zirat lands, grew various kinds of crops thereon, and, after meeting his personal requirements, a portion of the excess, which was not required, was sold. The Sales Tax Officer concerned served a notice on him to get himself registered as a dealer. The proprietor denied his liability to furnish the returns or produce papers, but, as the Department persisted, he instituted a suit claiming a declaration that he was not a "dealer" under the Sales Tax Act (Bihar Act IV of 1944), and was, therefore, not liable to be registered; and for an injunction against the authorities preventing them from realising any tax from him. One of the questions, therefore, which arose for consideration by the learned Judges in that case was whether the petitioner was a "dealer" within the meaning of the Act. In the Bihar Act again, the words were identical, namely, whether the person "carried on the business of selling or supplying goods", and it was held that the mere fact that he sold agricultural produce or goods would not constitute him a "dealer", because that was not an independent business which he had been carrying on. Reference was made also to various provisions of the Act, from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f selling or supplying goods, and, as such, was liable to be taxed under the Sales Tax Act. Reliance was placed by the learned Chief Justice upon the decision in the Patna case referred to above. A significant dictum, which is quoted there, occurs in the judgment of the Privy Council in Producers Co-operative Distributing Society v. Commissioner of Taxation[1948] 16 I.T.R. Supp. 87. The Privy Council observed thus: "Their Lordships are prepared to assume that, did the farmer himself make the butter, such butter would be an agricultural product within the meaning of the definition. In such a case, the farmer uses or cultivates his land for the production of butter just as he uses or cultivates it for production of milk and cream. But, from the fact that butter may be an agricultural product, as defined, it does not, in their Lordships' view, follow that butter which is not solely the product of the farmer's use or cultivation of his land must also be an agricultural product as defined. In this particular case, such use or cultivation results only in one definite product-cream. At that stage, a distinct organized industry appears on the scene." This passage is significant because it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of selling in the sense of transferring property in goods, but it must be the activity of carrying on the business of selling or supplying goods. Even though it may be a periodical process, in other words, from year to year, that the petitioner may have been disposing of the sal trees, in our opinion, the transaction in this case lacks the essential attributes of carrying on a business as such. There is neither any element of purchase, nor any element of manufacture involved in the process, nor is the business an independent business, as such. We must, therefore, uphold the contention that the petitioner is not a "dealer" within the meaning of the Act, and, as such, is not liable to be registered. In the view which we have taken on this point, it is perhaps needless to examine the other question, which has been raised before us, namely, that the sale of timber in this case is not a sale of goods. It would be useful, however, to indicate the point which has been urged before us. It has been argued that the word "goods", excluding irrelevant matters, means all kinds of movable property. The term "movable property" has not been defined in the Act itself, but the learned counsel for t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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