S.C. Manchanda, J.
1. The question referred for decision to this Court under Section 11 of the U.P. Sales Tax Act is whether in the circumstances and on the facts of the case the assessee came within the meaning of the term 'dealer' under Section 2(c) of the U. P. Sales Tax Act.
2. The facts leading up to this petition briefly are these. The assessee is a manufacturer of railway vans and bogies and had taken one contract for the supply of 36 parcel vans for Rs. 3,96,000 to the North Eastern Railway. The assessee was carrying on the business of structural engineers, ship, wagon and coach builders as a partnership firm at Calcutta. From the material on record, in the year of account, it appears that this was the only contract taken for the supply of railway wagons to the North Eastern Railway. The agreement between the General Manager, on behalf of the President of India, and the assessee was a single contract for the supply of 36 parcel wagons. The assessee had no branch or place of business in this State but the railway authorities gave them facilities for assembling the wagons in their workshop at Izatnagar.
3.The Judge (Revisions) Sales Tax held that the assessee might be a dealer but it was not carrying on business of selling in the State of Uttar Pradesh.
4. Mr. Kakkar, the learned Senior Standing Counsel for the State has contended that the fact that the assessee was assembling the wagons in the State of Uttar Pradesh would amount to carrying on a business within the State. A dealer is defined as a person who carries on the business of buying and selling goods in Uttar Pradesh. The question is, whether the assessee, who is merely assembling the parcel vans at Izatnagar, can be said to be carrying on the business of selling railway vans in Uttar Pradesh as the vans were supplied at Gorakhpur. The definition of business under the Sales Tax Act is somewhat different from that under the Income-tax Act where it includes an adventure in the nature of trade. A single sale will not be sufficient to constitute such a person as a dealer carrying on the business of selling goods in Uttar Pradesh. The mere selling of goods in Uttar Pradesh is not taxable unless it is in the course of carrying on a business in Uttar Pradesh.
5. To constitute business there must be a repetition or continuity of acts of buying and selling in Uttar Pradesh. The contract in the present case being one, it would not prima facie satisfy the tests of carrying on the business of selling in this State. All that the assessee did was to execute one contract for the supply of vans to the Government of India to its representative, the Manager of the North Eastern Railway at Gorakhpur. The contract itself was entered into at Calcutta. The assessee had no branch or office or workshop in this State. Government provided facilities in their workshop at Izatnagar. If there had been similar contracts executed in respect of other parties also in the State it may have business here. The Privy Council in Senaji Kapur Chand v. Devi Chand (A.I.R. 1930 P.C. 300), observed that the purchase and sale of a single article or a number of articles on a single contract may not amount to business, as the essence of business is the repetition of acts. No doubt, the assessee is carrying on business, but that is not enough to make it a dealer. It must be established that the assessee was carrying on business in this State. Beyond this single contract, there being no other transaction, it becomes difficult, if not impossible, to say that the assessee was carrying on a business in this State.
6. For these reasons, the question referred must be answered in the negative and against the department. The department will pay the assessee costs which are assessed at Rs. 200.
Sales Tax Reference No. 253 of 1958.
S.C. Manchanda, J.
7. The learned counsel for the parties have given a joint statement that the answer in this case must also be the same as that given by us in Sales Tax Reference No. 252 of 1958.
8. For the reasons given therein, we answer this question against the department and in favour of the assessee. The department will pay the costs of this reference which we assess at Rs. 200.