A statutory body like the Port Trust, which does not carry on business in the nature of trade or commerce, is not a "dealer" within the meaning of the Tamil Nadu General Sales Tax Act, 1959, and is therefore not liable to pay sales tax on the auction sales of unclaimed goods.

K. A. SWAMI, C.J.

This appeal is preferred against the order dated 30th March, 1994 passed by the learned single Judge dismissing Writ Petition No. 5509 of 1994, in which the notice issued to the petitioner on February 8, 1994 by the Commercial Tax Officer, Harbour-I, to furnish the details of the auction sales conducted during the year 1993-94 from April 1, 1993 was challenged.

2. The learned single Judge has taken the view that the decision in State of Madras v. Trustees of the Port of Madras wherein it has been held that the Port Trust cannot be held to be a "dealer" as defined in the Tamil Nadu General Sales Tax Act, 1959 (hereinafter referred to as "the Act") does not hold good, having regard to the amendment to section2(g) of the Act. According to the learned single Judge, the amendment is wide enough to take in its fold the Port Trust also and, therefore, the aforesaid Division Bench decision cannot be held to hold good after the amendment. Accordingly, the learned single Judge dismissed the writ petition.

3. In Trustees of the Port of Madras v. State of Madras a Division Bench of this Court has held in categorical terms that the Port Trust Act does not constitute the Board of Trustees of the Port Trust for the purpose of carrying on any business in buying and selling with a view to make a profit. Therefore, there will be no liability on its part to pay sales tax in respect of the charges levied and collected by them for water supplied to the ships.

4. Similarly, in State of Madras v. Trustees of the Port of Madras another Division Bench of this Court has taken the same view. It has been held that the Port Trust is a statutory body constituted by the Madras Port Trust Act, 1905, and though it is subject to certain control by the Central Government under the provisions of the Madras Port Trust Act, it cannot be said to be a department of the Central Government and, therefore, the Port Trust cannot be brought within explanation (2) to section2(g) of the Act. Even if the Port Trust is taken to be a local authority under section 2(g)(i), still it cannot be treated as a dealer unless it carries on the business of buying and selling, etc. It is also further held that the Port Trust at no time became the owner of the goods nor did it effect the sales as per the directions of the owners of the goods. The sales had been effected by the Port Trust only in exercise of its statutory right to recover its dues by enforcing its right of lien on the goods and the sale proceeds never became the property of the Port Trust. It cannot be said that the Port Trust had sold the unclaimed goods either as a commercial venture or as a dealer. Even in the face of the amended definition of "business", unless the Port Trust is treated as a dealer carrying on the business of selling, supplying or distributing the goods as a commercial venture its sales in the course of the course of the exercise of its statutory duties are not assessable to tax. Therefore, the sales of unclaimed or uncleared goods by the Port Trust could not be considered as sales effected by a dealer and were not liable to sales tax.

5. A similar view is also taken by the High Court of Andhra Pradesh in Board of Trustees of the Visakhapatnam Port Trust v. Commercial Tax Officer, Visakhapatnam.

6. In addition to that, it may also be pointed out that a Division Bench of this Court, while dealing with a case relating to Cement Research Institute of India in State of Tamil Nadu v. Cement Research Institute of India following the decision in Deputy Commissioner (C.T.) v. South India Textile Research Association has held that the Cement Research Institute of India cannot be said to be doing any business in the nature of trade or commerce within the meaning of section 2(d) of the Tamil Nadu General Sales Tax Act, even though the organisation pays excise duty on its manufacture of cement, and, therefore, is not liable either for sales tax or for purchase tax under section7-A of the T