Jeevan Reddy, J.@mdashThe question that arises in these four tax revision cases is whether the petitioner-assessee is liable to be taxed on the turnover relating to sale of back number copies of newspapers which remained unsold. The assessee concerned herein is "Andhra Prabha Private Ltd., Vijayawada." For the assessment years 1973-74 to 1977-78, the assessee, which carries on the business of printing and publishing the daily newspaper "Andhra Pradesh" sold as waste paper the back number copies of newspapers which remained unsold on the dates of their publication. These were brought to tax by the assessing authority u/s 5(1) of the Andhra Pradesh General Sales Tax Act, 1957, which was questioned by the assessee. Two contentions were urged before the Tribunal, viz., (i) that even the unsold newspapers, i.e., back number copies of newspapers, are also "newspapers" and, therefore, not exigible to tax; and (ii) that even if the back number copies of newspapers are not exempt from tax, still no tax can be levied inasmuch as the assessee is not a "dealer" and also because its main business is not taxable. Since the main business is not taxable, the sale of surplus newspapers as waste paper is merely incidental to the main business, and cannot be taxed. On both the questions the Tribunal held against the assessee.
2. Before us, Mr. S. Dasaratharama Reddi, learned counsel for the petitioner-assessee, did not urge the first question since it is concluded against the assessee by the decision of the Supreme Court in Indian Express (P.) Ltd. v. State of Tamil Nadu [1987] 67 STC 474 where it has been held that when unsold surplus copies of newspapers are disposed of by weight as waste paper, their sale cannot be regarded as the sale of newspaper. The main contention urged by Mr. Dasaratharama Reddi is that, even so, no tax can be levied upon the said turnover, inasmuch as the petitioner is not a "dealer" and also because the main activity of the petitioner, viz., printing, publishing and selling of newspaper, is not taxable under the Act.
3. One should think that even the second contention urged by Mr. Dasaratharama Reddi is concluded against the assessee by the very same decision of the Supreme Court, referred to above. Indeed, that case related to "Indian Express (Private) Ltd." which is practically the same concern as the petitioner-assessee herein. There it has been held clearly that the turnover of the publisher of a newspaper relating to the sale of surplus copies of newspaper is taxable under the terms of section 2(d) of the Tamil Nadu General Sales Tax Act, 1959, as it stood at the relevant time. Section 2(d) of the Tamil Nadu Act defines the expression "business", in the same terms as the definition of "business" in clause (bbb) of section 2 of the Andhra Pradesh Act. It was held in the said decision that the transactions of sale of surplus copies of newspapers must be regarded as the business carried on by the publisher, and that it was an activity which it pursued regularly with a profit making motive. It was, further observed that "it was incidental to the business carried on by the appellant of printing and publishing newspapers." Mr. Dasaratharama Reddi, however, contended that before the Supreme Court it was not urged that inasmuch as the publisher is not a "dealer" and also because its main activity is not taxable, the incidental activity is equally exempt from tax. He says, this is the principle recognized by this Court in A.P. State Road Transport Corporation v. Commercial Tax Officer [1971] 27 STC 42, Board of Trustees of the Visakhapatnam Port Trust v. Commercial Tax Officer [1979] 43 STC 36, Base Repair Organisation v. State of Andhra Pradesh [1983] 53 STC 223, and T.R.C. No. 80 of 1984, disposed of on 17th February, 1988, State of Andhra Pradesh v. A.P. Housing Board [1988] 70 STC 203.
4.
5. In our opinion, the facts of the case before us are distinguishable from the facts in the above decisions. Here, undoubtedly, the petitioner carries on the business of printing, publishing and selling newspapers. Indubitably, it is a "business" as defined in the Act. However, since the sale of newspapers is not exigible to sales tax, the assessee is neither registered as a dealer, nor is any tax levied upon the sale of newspapers. But this does not mean that it is not carrying on a business as defined by, and within the meaning of the Act. Now, selling of surplus unsold newspapers is incidental to the main activity, or main business, as it may be called, as held by the Supreme Court, which reasoning is also binding upon us. It is not as if the sale of such surplus or unsold newspapers is an integral part of the petitioner''s business, in which case the principle of the decision in Base Repair Organisation v. State of A.P. [1983] 63 STC 223 (AP) will apply. Since the said activity is merely incidental to the main business, it is taxable. The fact that the petitioner is not registered as a dealer makes no difference to the eligibility to tax. It may be that having regard to the relevant statute, a Housing Board cannot be held to be carrying on business; but the same cannot be said with respect to the main activity of the petitioner - and that is the distinction. In this connection, we may mention that even the Railways which dispose of their scrap and other unusable articles are held to be "dealers" and exigible to tax [vide
6. Mr. Dasaratharama Reddi relied upon two Calcutta decisions reported in Chief Commercial Superintendent v. Member, Board of Revenue [1973] 32 STC 171 and Cementation Patel v. Commissioner of Commercial Taxes [1981] 47 STC 385. The principle of both these decisions is that if the main, i.e., essential activity carried on by a person is not business, any incidental or ancillary transaction too would not be business, and cannot also be taxed. The principle of these decisions can have no application in this case since the main activity carried on by the petitioner herein is "business", though not taxable under the Act.
7. For the above reasons, the tax revision cases are dismissed; but, in the circumstances, there shall be no order as to costs. Advocate''s fee Rs. 500 consolidated.
8. Petitions dismissed.
