TMI Blog1963 (3) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... n all constructions it arranged to supply the contractors with certain materials required by them in the constructions from its own stores on certain prices. The terms of the contracts with the contractors included the following: "(1) The contractor shall be supplied with such materials and stores as are required from time to time to be used by him for the purpose of contract only. (2) The value of the full quantity of the materials and stores so supplied at the rates specified in the said schedule of the memorandum may be set-off or deducted from any sums due or thereafter to become due to the contractor under the contract or otherwise. (3) All materials supplied to the contractor are the property of the contractor but shall not on any account be removed from the site of the work except with the permission of the Assistant City Engineer or under the orders of the Assistant Engineer and shall at all times be open to inspection by the Engineer in charge. (4) Any materials unused and in perfectly good condition at the time of the completion or determination of the contract may by special arrangement be taken over by the Kanpur Development Board at the prevailing market rate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... than a statement of the case; it contains irrelevant matter and discussion of questions of law. I am surprised to find a statement of the case containing so much irrelevant material. It is clear from the statement of the case that the Board issued materials to the contractors from its stores and transferred property in them for deferred payment. "Sale" is defined in section 2(h) to mean transfer of property in goods for cash or deferred payment. The restrictions on the contractors' power to remove the materials from the site and the requirement that they will always be open to inspection by the Board's engineers do not detract from the term that the property in the materials was transferred to the contractors. The contractors had to pay for the property transferred to them though not in cash. When they submitted their bills for the work done by them the price of the materials supplied to them was deducted from the amounts of their bills and the balance was paid to them. So property in the materials was transferred to them for deferred payment and the trans- action amounted to sale. The term regarding repurchase confirms, rather than disproves, that there was sale; repurchase of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness, the mind naturally contemplates a commercial or industrial establishment or enterprise"; (ditto p. 765) and this is all the more true when the Sales Tax Act speaks of the business of selling goods. In Words and Pharses, Vol. I, by Burrows, it is said that one meaning of business is any particular matter or affairs of serious importance (as used in "goes to see him on business") and that the other meaning is an active occupation or pro- fession continuously carried on and that it is in this sense that the word is used in Finance (No. 2) Act, 1915, sections 38 and 39. In Income-tax Commissioner v. Shaw Wallace and Co.(1932) I.L.R. 59 Cal. 1343., the Judicial Com- mittee observed at page 1351 that the fundamental idea of the con- tinuous exercise of an activity underlies the word "business". In Deputy Commercial Tax Officer v. Cosmopolitan Club[1955] 6 S.T.C. 1., Balakrishna Ayyar and Rajagopala Ayyangar, JJ., held that a club which sells re- freshments at standard rates to its members does not carry on the business of selling goods within the meaning of the Madras General Sales Tax Act which also defines "dealer" as a person who carries on the business of buying or selling good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the business of...... selling goods"; but it chose the word "dealer". It must have done so with the know- ledge of the fact that in interpreting the word "business" used in the definition the mind would at once go to the idea of earning a livelihood or making a profit. The Legislature did not use the word merely to indicate that the activity must be a continuous one because then it would have used some other word such as "practice", "activity" or "system". The idea of continuity was already there in the words "carrying on", and the word "business" was not required to indicate it; if it was used when the idea of, continuity was already there it must have been used only to convey the idea of profit-making. Our attention was drawn to the words "whether for commission, remuneration or otherwise" qualifying the words "carrying on the business" and it was argued that the definition of "dealer" includes a person carrying on the business otherwise, i.e., without any intention of making a profit. I see no force in the argument. The word "other- wise" means "other than for commission or remuneration". If a busi- ness is carried on for profit it cannot be said to be carried on for com- miss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a profit. Carrying on a business for a profit is not one of the duties of the Board; it is expected to raise money needed by it through taxation. It is clear from these facts that the Board had no intention to make a profit out of the sale of goods to contractors. Even in the broad sense, the Board could not be said to have remained busy with selling goods to contractors; having regard to its statutory duties one can say that its being occupied in the sale of goods was so negligible in comparison to its being occupied with the perform- ance of statutory duties that it could hardly be said to have remained busy with sale of goods. Even if it enters into this kind of contract with every contractor it is not known how many contractors take ad- vantage of the facility offered to them by the Board and to what extent. Whether it remains busy with selling goods or not would depend upon the extent to which its contractors apply to it for sale of goods. Sri Shanti Bhushan argued that the narrow meaning of the word "business" offends against Article 14 of the Constitution. I do not understand how it would but even if it would the effect would be that the Board will not be liable to pay s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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