# ANDSALESTAX,CENTRALZONE,ERNAKULAM v. M/S. PALAMPADAM PLANTATIONS LTD., KOTTAYAM

- **Citation:** [1969] 3 S.C.R. 674
- **Court:** Supreme Court of India
- **Decided:** 1969-02-12
- **Case number:** Civil Appeal No. 1058 of 1967
- **Bench:** J. C. Shah, V. Ramaswami, N. Grover
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/andsalestax-centralzone-ernakulam-v-m-s-palampadam-plantations-ltd-kottayam-4626
- **Pages:** 3

## Headnote

Kera/a General Sales Tax Act (Kera/a
15 of 1963),
s.
2(viii)-
Dealer-Trees of spontaneous growth in private forest-I/ 'produced' hy
o»'ner of forest-'Produced', meaning of.
Where a person owns and maintains a private forest and sells trees of
spontaneous growth therein but does not do anything towards the production of the trees or their uprooting, be is not a 'dealer' within the meaning
of s. 2(viii) of the Kerala General Sales Tax Act. I963. In order t<> fall
within the definition, a person must sell goods produced by him by manufacture, agriculture, horticulture or otherwise.
The intention of the Legislature in using the word 'produced' was to introduce an element of voli·
tion and effort involving the employment ·df
some process for bringing
into existence the goods.
Trees which hav~ grown spontaneously without
any plantation by a person cannot be said to have been produced by him
hy agriculture or horticulture or •otherwise', stnce the element of 'production is not present. [675 H; 676 A-B, C-D]

## Text

674
DY. COMMISSIONER OF AGRICULTURAL INCOME TAX,
A
ANDSALESTAX,CENTRALZONE,ERNAKULAM
v.
M/S. PALAMPADAM PLANTATIONS LTD., KOTTAYAM
February 12, 1969
[J. C. SHAH, V. RAMASWAMI AND A, N. GROVER, JJ.]
Kera/a General Sales Tax Act (Kera/a
15 of 1963),
s.
2(viii)-
Dealer-Trees of spontaneous growth in private forest-I/ 'produced' hy
o»'ner of forest-'Produced', meaning of.
Where a person owns and maintains a private forest and sells trees of
spontaneous growth therein but does not do anything towards the production of the trees or their uprooting, be is not a 'dealer' within the meaning
of s. 2(viii) of the Kerala General Sales Tax Act. I963. In order t<> fall
within the definition, a person must sell goods produced by him by manufacture, agriculture, horticulture or otherwise.
The intention of the Legislature in using the word 'produced' was to introduce an element of voli·
tion and effort involving the employment ·df
some process for bringing
into existence the goods.
Trees which hav~ grown spontaneously without
any plantation by a person cannot be said to have been produced by him
hy agriculture or horticulture or •otherwise', stnce the element of 'production is not present. [675 H; 676 A-B, C-D]
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1058 of
1967.
Appeal by special leave from the order dated September 15,
1966 of the Kerala High Court in Tax Revisiqrl Case No. 106 of
1966.
M. R. Krishna Pillai, for the appellant.
The respondent did not appear.
The Judgment of the Court was delivered by
Grover, J. This is an appeal by special leave from a judgment
of the Kerala High Court dismissing in limine a revision petition
directed against the order of the Sales Tax Appellate Tribunal
dated April 15, 1966 by which it was held that the respondent
company was not a "dealer" within the meaning of s. 2(viii) of
the Kerala General Sales Tax Act 1963 (Act 15 of 1963) hereinafter called the "Act''.
The respondent sold trees of spontaneous growth in its estate
for Rs. 50,000 during the assessment year 1963-64. The assessing authority levied sales tax by treating the aforesaid amount as
taxable turnover under the Act. In appeal the Appellate Assistant Commissioner confirmed that order. Before the Appellate
Tribunal it was common ground that the trees sold were of spontaneous growth.
The Tribunal did not accede to the contention
B
c
D
E
F
G
H
A
8
c
DY. COMMR. s. T. v. PALAMPADAM (Grovu, J.)
675
of the State representative that Under the contrac.t, by the process
of uprooting the trees, the respondent produced Umber and would
be covered by the definition of a "dealer" contained in s. 2(viii)
of the Act. It was held that uprooting of the trees was not being
done by the respondent and no process had been employed by
which it could be said that timber had been produced by it. The
appellant herein filed a petition before the High Court raising
the following questions of law :
"(1) Whether on the facts and in the circumstances
of this case, a person owning and maintaining priv~te
forest and selling trees of spontaneous growth therem,
is a 'dealer' within the meaning of section 2 (viii) of the
Kerala General Sales Tax Act, 1963 ?
(2) Whether such a person is liable to the levy of
sales-tax respect of sales of his timber. under the s!tld
Act?"
D
As mentioned before the High Court rejected the petition for
revision at the preliminary hearing.
The sole question is whether on the findings given by the
Appellate Tribunal the respondent can be regarded as a "dealer"
within the definitii:Jin given in s. 2(viii). According to that defiE
nition "dealer" means any person who carried on the business of
buying, selling, supplying or distributing goods directly or otherwise whether for cash or for deferred payment or for commission,
remuneration or other valuable cQ!lSideration and includes ..... .
F
( e) a person who sells goods produced by him by manufacture,
agriculture, horticulture or otherwise.
It has been contended before us by learned counsel for the
appellant that the Aopeliate Tribunal erred in assuming that any
agricultural, horticultural or other process was involved in producing the timber sold. The basic questiol!f it is said, was whether
ma!ntenance of a private forest with a view to producing and
sellmg valuable timber with the usual attributes of business preG
sent in the said activity, namely, periodicitv. continuity and profit
motive would amount to such process.
The other question was
whether the said activity i.e .. forestry would not come within the
scope of "agriculture, horticulture or otherwise" particularly when
the respondent owns substantial area of forest land, and timber
from the trees of spontaneous growth is sold year after year with
H
the object of earning profit.
Now in order to fall within the definition of "dealer" a person
must sell goods prod\lced by him by manufacture, agriculture,
676
SUPREME COURT REPORTS
(1969] 3 s.c.R.
horticulture or otherwise.
Such trees which have grown spontaneously and without any plantation by that person cannot passibly
bei regarded as having been produced by him by agriculture 6f
horticulture.
The word "otherwise" also cannot cover trees of
spontaneous growth since the elemqn,t of production must be present. The context in which the word "produced" appears in the
definition can only mean "to bring forth, bring into being or existence-to bring (a thing) into existence from its raw materials or
elements : " (See the meaning oi the word "produce'' in the Shorter
Oxford English Dictionary) .. According to Websters' International
English Dictionary the verb "produce" means to bring forward,
beget etc.
The juxtaposition of the word "manufacture"
with
"agriculture" ~
"horticulture" is significant and cannot be lost
sight of.
The intention in employing the word "produced" obviously was to introduce an element of volition and effort involving the employment of some process for bnnging into existence
the goods.
The respondent in the present case has
not been
found to have done anything towards the production of the trees
and even the cutting has been done .by the contractor. The respondent therefore cannot possibly be regarded as a person who
sells goods produced by him by agriculture, horticulture or otherwise.
On the above view of the matter. the appeal fails and is dismissed.
As there is no appearance on behalf of the respondent
there will be no order as to costs in this Court.
V.P.S.
Appeal dismissed.
A
B
c
D