DY CAIT ERNAKULAM Vs. PALAMPADAM PLANTATIONS LTD

JUDGEMENT

(1.) THIS is an appeal by special leave from a judgment of the Kerala High Court dismissing in limine a revision petition directed against the order of the Sales Tax Appellate Tribunal dated April 15, 1966 by which it was held that the respondent company was not a dealer within the meaning of S. 2 (viii) of the Kerala General Sales Tax Act 1963 (Act 15 of 1963) hereinafter called the "act".

(2.) THE respondent sold trees of spontaneous growth in its estate for Rs. 50,000/-during the assessment year 1963-64. THE assessing authority levied sales tax by treating the aforesaid amount as taxable turnover under the Act. In appeal the Appellate Assistant Commissioner confirmed that order. Before the Appellate Tribunal it was common ground that the trees sold were of spontaneous growth. THE Tribunal did not accede to the contention of the State representative that under the contract, by the process of uprooting the trees, the respondent produced timber and would be covered by the definition of a "dealer" contained in S. 2 (viii) of the Act. It was held that uprooting of the trees was not being done by the respondent and no process had been employed by which it could be said that timber had been produced by it. THE appellant herein filed a petition before the High Court raising the following questions of law: " (1) Whether on the facts and in the circumstances of this case, a person owning and maintaining private forestry and selling trees of spontaneous growth therein, is a'dealer' within the meaning of S. 2 (viii) of the Kerala General Sales Tax Act, 1963? (2) Whether such a person is liable to the levy of sales-tax in respect of sales of his timber, under the said Act ?" As mentioned before, the High Court rejected the petition for revision at the preliminary hearing.

(3.) NOW in order to fall within the definition of "dealer" a person must sell goods produced by him by manufacture, agriculture, horticulture and without any plantation by that person cannot possibly be regarded as having been produced by him by agriculture or horticulture. The word "otherwise" also cannot cover trees of spontaneous growth since the element of production must be present. The context in which the word "produced" appears in the definition can only mean "to bring forth, bring into being or existence to bring (a thing) into existence from its raw materials or elements:" (See the meaning of the word "produce" in the Shorter Oxford English Dictionary ). According to websters' International English Dictionary the verb "produce" means to bring forward, beget etc. The juxtaposition of the word "manufacture" with "agriculture" and "horticulture" is significant and cannot be lost sight of. The intention in employing the word "produced" obviously was to introduce an element of volition and effect involving the employment of some process for bringing into existence the goods. The respondent in the present case has not been found to have done anything towards the production of the trees and even the cutting has been done by the contractor. The respondent therefore cannot possibly be regarded as a person who sells goods produced by him by agriculture, horticulture or otherwise.