Security Equipment Supply, Inc. v. Richard H. Roberts, Commissioner Of Revenue, State of Tennessee

At issue is whether a taxpayer’s sales are properly classified as “retail sales” or “wholesale sales” under the Business Tax Act, Tenn. Code Ann. §§ 67-4-701 to -730, and Tenn. Comp. R. & Regs. 1320-04-05-.47. Following an audit, the Tennessee Department of Revenue determined that the taxpayer misclassified its sales as “wholesale sales,” when they should have been classified as “retail sales,” and assessed the taxpayer with $74,088.10 in tax liability. After paying the assessment, the taxpayer filed suit seeking a refund. The chancery court held that the sales in question were “retail sales” within the context of the statute and denied the request for a refund. We conclude that the business activities were properly classified as retail sales; therefore, we affirm the judgment of the chancery court.