A dealer under the Bengal Finance (Sales Tax) Act, 1941, must be a person who carries on the business of selling goods in West Bengal.

( 1 ) IN this reference under Section 21 (1) of the Bengal Finance (Sales Tax) Act, 1941, the Board of Revenue has referred the following question to this court: whether, the petitioner-railway, in so far as it effects sales of unclaimed and unconnected goods under the provisions of Section 56 of the Indian Railways Act, is a dealer within the meaning of Section 2 (c) of the Bengal Finance (Sales Tax) Act, 1941 ?

( 2 ) THE South Eastern Railway, at whose instance this reference has been made, disposes of unclaimed goods for consideration of money. On the 29th August, 1957, the Commercial Tax Officer, Lyons Range Charge, Calcutta, issued a notice in form No. VI under Sections 11 and 14 (1) of the Bengal Finance (Sales Tax) Act, 1941, to the Chief Commercial Superintendent, South Eastern Railway, directing him to produce on 12th November, 1957, the books of accounts and other documents for the purpose of assessment of tax payable under the said Act in respect of the period of four quarters ending March, 1957. Thereafter, a petition dated 12th August, 1958, was filed before the said Commercial Tax Officer praying for cancellation of the registration certificate on the ground that the South Eastern Railway was not a dealer within the meaning of the said Act as the said railway was neither a producer nor supplier for value of the unclaimed and unconnected goods sold in the public auction. The said Commercial Tax Officer did not agree with the said contention and he, accordingly, held by his order dated 6th June, 1959, that the disposal of unclaimed goods was a regular feature of the said railway. Accordingly, the assessment was completed after hearing the assessee on 6th June, 1959. Against the order dated 6th June, 1959, the assessee filed a revision petition before the Assistant Commissioner of Commercial Taxes, Calcutta, Chowringhee Circle. The point that was urged was whether the South Eastern Railway could be treated as a dealer or not within the meaning of the said Act. It was contended that the Government did not become a dealer irrespective of the nature of the sales conducted by it in some cases. It was also submitted that unclaimed and unconnected goods came into the possession of the railway not as a result of any activity of purchase or of manufacture for sale. When these came into its possession, the railway acquired some rights over these goods exercisable under Section 56 of the Railways Act, rendering surplus, if any, of the sale proceeds to any person entitled thereto. The Assistant Commissioner of Commercial Taxes held in his order that if the sales effected by the railway conform to the definition provided under the Act, the railway should discharge the obligation of a dealer and should account for the same. He also observed in the said order that the Government had been included under the Act within the meaning of "dealer" under Section 2 (c) of the Bengal Finance (Sales Tax) Act by the West Bengal Amendment Act of 1950. He, accordingly, rejected the revision petition filed before him by the order dated 27th January, 1960.

( 3 ) A revision petition was then filed before the Commissioner of Commercial Taxes, West Bengal. The Additional Commissioner of Commercial Taxes who dealt with the case rejected the said revision petition and confirmed the order of the Assistant Commissioner by his order dated 17th June, 1960. The assessee thereafter filed a revision petition before the Board of Revenue, West Bengal. The first contention before the Board was that the railway did not acquire property in the goods sold by it, but only possession and that as such it could not be said that the railway sold the goods. The next contention was that the railway did not carry on the business of selling. Regarding the first contention, the Board held that the transfer of property was involved in the auction held by the railway and as such, it should be held that there was sale of goods in such an auction held