TMI Blog1970 (3) TMI 139X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to tax on the value realised by such sale. The Andhra Pradesh State Road Transport Corporation is constituted under the Road Transport Corporation Act, 1950. The object of this Corporation is to provide or secure or promote the provision of an efficient, adequate, economical and properly co-ordinated system of road transport service in the State. It is not a trading Corporation. Ever since it was constituted in 1958 it has been operating bus services on various routes in the State. In the course of its activity, scrapped vehicles, old tyres, old containers and other unserviceable material were left with the Corporation which it has been disposing of periodically by public auction or by inviting tenders. The proceeds of the sale of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... achinery and parts of machinery and accessories for manufacturing which the company maintained a foundry and purchased two arc furnaces with a view to utilise the same in its foundry but later found it unsuitable for the purpose and disposed of the same at a profit and the assessing authorities sought to include the amount realised by such sale in the turnover of the company. It was held that where a person in the course of carrying on the business was required to dispose of what may be called his fixed assets or his discarded goods acquired in the course of business an inference that he desired to carry on the business of selling his fixed assets or his discarded goods would not ordinarily arise. The arc furnaces were either fixed assets o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come a dealer in those goods, unless he has an intention to carry on the business of selling those goods." In view of these pronouncements of the Supreme Court, the Andhra Pradesh State Road Transport Corporation which is primarily constituted for operating an efficient road transport service, could not be held to be carrying on business of selling the discarded vehicles and other scrap which it has come into possession in the course of its activities. It is, however, argued by Mr. Ramachandra Reddy, learned counsel for the Government Pleader that the sale of these goods was a transaction in connection with or incidental or ancillary to such trade, commerce, manufacture, adventure or concern within the meaning of clause (ii) of section 2(bb ..... X X X X Extracts X X X X X X X X Extracts X X X X
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