Sales Tax India - Dealer liable to CST
“Dealer” means any person who carries on (whether regularly or otherwise) the business of buying, selling, supplying or distribution of goods, directly or indirectly, for cash, or for deferred payment, or for valuable consideration Definition of ‘dealer’ is wide, but only those who ‘effect’ sale are liable to register and pay CST.
Government is dealer: Government is ‘dealer’ if it carries on business. Railways are ‘dealers’. Insurance company is also ‘dealer’.
Bank, club, auctioneer as dealer:
Bank can be dealer in respect of sale of pledged goods, if definition of ‘dealer’ includes bank. Sale of pledged goods takes place in the course of business. A ‘club’ can also be ‘dealer’. An auctioneer is not a dealer, if he does not transfer the property in the goods to the successful bidder.Profit motive not required: Profit motive is not material for ‘Business’. Adventure is also ‘business’.
Adventure is also business: Business normally implies something done on regular basis. However, since business includes ‘Adventure’, occasional transactions may also be covered. Adventure implies some ‘speculation’.
Ancillary, incidental business taxable:
Ancillary, incidental and casual business is also taxable, but main activity should be ‘ to carry on business’.Incidental or ancillary business like. sale of used car, sale of scrap, sale of old machinery, sale of old furniture etc. is taxable, though normally the dealer may not be in business of selling cars, furniture or machinery.
Sale of business is not business and cannot be taxed: Sale of business is not business and cannot be taxed.