1975 (1) TMI 76 - HC - VAT and Sales Tax

Summary

Issues:
Determining whether a sculptor making statues and busts for commission is considered a dealer under the Bombay Sales Tax Act, 1959.

Analysis:
The case involved a sculptor who inherited the artistic profession from his father and continued the business under a different name. The sculptor, in response to potential sales tax implications, sought clarification from the Commissioner of Sales Tax regarding his status as a dealer under the Bombay Sales Tax Act, 1959. The sculptor created statues and busts based on specific orders, requiring significant artistic skill and time for completion. The Deputy Commissioner of Sales Tax initially classified the sculptor as a dealer engaged in the purchase and sale of goods. However, the Sales Tax Tribunal overturned this decision, leading to the reference before the High Court.

The High Court, in its analysis, referred to a previous judgment related to a commercial artist, emphasizing that the essence of contracts involving artists is the artistic skill and labor rather than the material used. The Court highlighted that the core aspect of such contracts is the artistic ability of the artist, whether it be a painter, sculptor, or commercial artist. Drawing parallels with a case before the Madras High Court, the High Court concluded that the sculptor in question was not engaged in selling goods but rather executing contracts based on skill and labor.

In conclusion, the High Court answered both questions raised in the reference in the affirmative, affirming that the sculptor was not considered a dealer under the Bombay Sales Tax Act, 1959. The Court ordered the applicant to bear the costs of the reference, thereby resolving the issue in favor of the sculptor.

This judgment provides clarity on the distinction between contracts of skill and labor versus contracts of sale of goods in the context of artistic professions, setting a precedent for similar cases involving artists and sculptors under sales tax legislation.