( 1 ) THE petitioner bank is a nationalized bank constituted under the Banking Companies (Acquisition and transfer of Undertakings) Act, 1980 and is carrying on the business of banking with its head office at Mangalore having several branches throughout India including branches at Warangal and Guntur in the State of andhra Pradesh. The primary business of the petitioner Bank is banking as contemplated under Section 5 (b) of the banking Regulation Act, 1949 and also such other activities which are ancillary and incidental thereto. The petitioner Bank advances loans of different types to individuals, institutions and other concerns in accordance with the directives of the reserve Bank of India. For the purpose of securing loan advanced by the bank it receives securities of different types from its customers. One such type of security is deposit of gold jewellery against the cash advanced. If the borrower fails to repay the loan within the stipulated period the petitioner bank reimburses itself by selling the pledged articles such as gold jewellery. This mode of lending is approved by the reserve Bank of India. The petitioner Bank realised certain amounts by selling the gold ornaments pledged to it against the loans. The Commercial Tax Officer, Warangal through his letter Rc. No. A3/93/89, dated 3-4-1989 demanded payment of sales tax on the amount realised by the petitioner Bank at its Warangal branch from the sale of jewellery. The Commercial Tax Officer, guntur through his letter Rc. No. 334/89-A5, dated 18-10-1989 has also demanded from the petitioner bank at its branch at Guntur details regarding the sale of pledged jewellery. These two communications have been challenged in this writ petition and it is submitted that the respondent State has no power under the Sales Tax Act to demand sales tax on the above-mentioned sales. It is further submitted that the Government had issued a G. O. Ms. No. 1091 on 10-6-1957 by which banks were exempted from application of the provisions of the A. P. General Sales Tax Act, 1957. But, some time earlier the respondents demanded payment of sales tax from several banks on the rents realised by them by leasing out the safe deposit lockers to their customers. All the banks approached the Court. During the pendency of the matter before the Court the respondent No. 1 withdrew G. O. Ms. No. 1091 which had granted exemption to the banks and thereafter respondent No. 1 issued G. O. Ms. No. 794, dated 19-8-1987 bringing all the banks within the purview of the provisions of the A. P. General Sales Tax act, 1957. Consequent upon the withdrawal of G. O. Ms. No. 1091 and introduction of g. O. Ms. No. 794, respondents have been issuing notices on some of the branches of the petitioner Bank directing them to furnish information regarding the amounts realised by them by sale of the pledged or hypothecated valuables such as gold ornaments.

( 2 ) COUNTER has been filed. We have heard the learned Counsel for the parties. The main grounds of attack against the action of the respondents in treating the petitioner Bank as dealer under the A. P. General Sales Tax Act was that bank was not a dealer in terms of Section 5 of the a. P. G. S. T. Act. It is further contended that since the petitioner could not be held to be a dealer, therefore, the bank was not subject to tax under the Sales Tax Act. So, in the light of the pleadings and arguments of the parties the only question which will have to be decided in this writ petition is, whether the petitioner Bank is a dealer carrying on business of buying and selling goods within the meaning of Section 5 of the A. P. General sales Tax Act. Section 5 of the A. P. G. S. T. Act is reproduced : "5. Levy of tax on sales or purchases of goods : (1) Save as otherwise provided in this Act, every dealer shall pay a tax under this Act for each year on every rupee of his turnover of sales or purchases of goods in each year irrespective of the quantum of his turnover