STATE OF MADRAS vs M/S.K.C.P. LTD.

The Supreme Court held that the sale proceeds of two arc furnaces, which were unsuitable for the respondent company's foundry, could not be included in the turnover for sales tax under the Central Sales Tax Act, 1956, specifically Sections 2(b) and 9(3). The Court established that the sale did not constitute a normal business activity of the company, as there was no intention to sell the furnaces for profit at the time of purchase. The High Court's decision to exclude the sale from taxable turnover was upheld, affirming that the respondent was not a dealer in this context.