Indian Kanoon - Search engine for Indian Law

1. The Revenue has preferred this revision against the order dated August 11, 1981 of the Tamil Nadu Sales Tax Appellate Tribunal, Second Additional Bench, Madras, in Tribunal Appeal No. 208 of 1981, setting aside the assessment made on the respondent-assessee, which was confirmed by the Appellate Assistant Commissioner, in relation to the assessment year 1973-74.

2. The assessee-respondent is Parle Products (P) Limited, 134, Thambu Chetty Street, Madras. It is not in dispute that the assessee's abovesaid office at Madras is a liaison office. Admittedly, Parle Products (Private) Limited carried on the business of manufacture and sale of Parle biscuits and confectioneries from its head office situated in Maharashtra and it sold the biscuits and confectioneries to several dealers, some of them were in the State of Tamil Nadu also. But, the question in the present case is not regarding those sales. On the other hand, the question is regarding the supplies of calendars to those dealers in Tamil Nadu, through the abovesaid liaison office (assessee) and at the instruction of the abovesaid head office at Bombay of Parle Products (Private) Limited. The actual question is whether those suppliers are sales exigible to tax under the Tamil Nadu General Sales Tax Act for the assessment year 1973-74.

10. The assessee, which is said to be liaison office of Parle Products (Private) Limited, is not a different entity from its head office at Bombay, which admittedly carried on "business" in the manufacture and sale of biscuits and confectioneries. While so it cannot be said that the assessee is not carrying on "business". It cannot also be said that the assessee is not carrying on "business" at Madras in relation to the abovesaid calendars. It is well-known that as per the definition of the term "business", under section 2(d), the requirement of profit-motive or actual accrued of profit, is not necessary for "business". So, even though calendars are supplied at 50 per cent cost and thus without any profit-motive or any accrual of profit, the supply of calendars would constitute "business". Further, it is well-known that even an adventure or a solitary transaction could be "business". So, simply because the calendars were supplied only once in a year, that is, either in March or in December, the activity cannot be termed as not coming within the definition of the term "business". Further, even though, the abovesaid supplies of calendars were incidental to the main business of the assessee's head office at Bombay in biscuits and confectioneries, the supplies would constitute "business", since as per section 2(d)(ii) such transactions also would constitute "business". No doubt, the assessee cannot be termed as "casual trader" as has been held by the assessing officer and the first appellate authority, since the assessee has a fixed place of business in Madras also. In this connection, it must be noted that "placed of business" as defined under section 2(1) would include even a place where a dealer keeps his books of account. It is in evidence in the present case that the assessee which is the liaison office at Madras, though not having other books of accounts, is keeping at Madras, registers showing the supply of calendars to its customers and the Appellate Assistant Commissioner has also found that there was no evidence to show that those books really belonged to Bombay head office as those registers from the year 1975, did "not bear evidence of production before the sales tax authorities of the other State".