The main legal point established is that toddy tapped by the petitioners from their own trees is not agricultural income and is subject to tax under the Karnataka Sales Tax Act, 1957.

RAJASHEKHARA MURTHY, J.

( 1 ) IN these writ petitions, the petitioners, who are licensed vendors of toddy have challenged the levy and collection of sales tax on the turnover of sale of toddy exigible to tax under entry 82 of the Second Schedule to the Karnataka Sales Tax Act, 1957 (hereinafter referred to as "the Act" ).

( 2 ) SEVERAL grounds are urged by Sri M. R. Nayak appearing for the petitioners and they are (i) that the sale of toddy in their taverns is not a "sale" within its meaning as defined under section 2 (t) of the Act and that therefore the petitioners are not "dealers" whose turnover in the sale of toddy could attract the levy of tax under the Act; (ii) that toddy is an "agricultural produce" and the petitioners are "agriculturists" whose turnover in sale of toddy is exempt under section 2 (k) of the Act and hence (iii) that the State Legislature is not competent to impose tax on the turnover of sale of toddy under entry 54 of List II of the Seventh Schedule to the Constitution.

( 3 ) WE will deal with the question whether the turnover in the sale of toddy in their shops or taverns does not constitute sale in order to attract the levy of tax under the Act later and we will now deal with the last two contentions first.

( 4 ) GROUNDS Nos. 2 and 3 relate to the question whether the petitioners are agriculturists and toddy is an agricultural produce and if so whether the State Legislature is competent to make a law with respect to levy of tax on the sale of toddy under the Act. It is the petitioners' contention that toddy is an agricultural produce and the petitioners are agricultural referred to in the exception to explanation-2 to section 2 (k) of the Act.

( 5 ) SECTION 2 (k) defines who is a dealer for purposes of the Act. "dealer" means any person who carries on the business of buying, selling, supplying or distributing goods, directly or otherwise, whether for cash or for deferred payment, or for commissioner, remuneration or other valuable consideration. "goods" as defined by the Sale of Goods Act means : "goods" means every kind of movable property other than auctionable claims and money; and includes stocks and shares, growing crops, grass, and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale. Exception to explanation-2 to section 2 (k) reads : "an agriculturist who sells exclusively agricultural produce grown on land cultivated by him personally shall not be deemed to be a dealer within the meaning of this clause. " section 5 of the Act is the charging section. Under section 5 (1) (a) the sale of any of the goods mentioned in column (2) of the Second Schedule, by the first or the earliest of successive dealers in the State, is subjected to tax under the said section at the rates specified in the schedule. Entry 82 of the Second Schedule to the Act provides for levy of tax on the sale of toddy. Second schedule gives the description of the goods and the rate of tax on the sale of goods referred to therein at single point tax on the first or earliest of successive dealers in the State. It is therefore the contention of Sri Nayak that no sale takes place in the petitioners' taverns since what is sold is the toddy tapped by them from the trees belonging to them. An argument is thus constructed on the presumption that toddy is not "goods" in order to attract the provisions of the Act, on its sale or purchase and thus falls outside the purview of entry 54 of List II of the Seventh Schedule to the Constitution of India which provides for "taxes on the sale or purchase of goods other than newspapers, subject to the provisions of entry 92a of List I". "goods" is defined under section 2 (m) of the Act as follows : "goods" means all kinds of movable property (other than newspapers, auctionable claims, stocks and shares and securities) and includes livestock, all materials, commodities, and articles (including those to be used in the fitting ou

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