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TMI Blog2002 (5) TMI 231X X X X Extracts X X X X X X X X Extracts X X X X ..... er will, however, cover only one year i.e. financial year 1995-96 and so far as the order in relation to financial year 1996-97 is concerned, no cognizance is being taken with respect to that year and the same is ignored. 3. According to the Assessing Officer, a survey under section 133A was conducted in the business premises of the assessee on 8-10-1997. It was noticed that the assessee company did not deduct the tax as per the provisions of section 194C from the payments made to M/s. Mudranika on account of supply of printed labels to be utilized for pasting on bottles. The material consisted of imported mirror coat paper labels like Officer's choice, whisky labels etc. The Assessing Officer therefore, issued summon to the assessee. It was contended by the assessee that it was giving only purchase order and on the said purchases, sales tax was paid and the transactions were not covered by the provisions of TDS. The Assessing Officer, however, did not agree with the assessee. He while holding that the assessee failed in deducting the tax from the payments made to M/s. Mudranika as per the provisions of section 194C has concluded as under: "I have considered all the submissions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as per the specifications of the appellant company. The learned counsel was, therefore, not correct in stating that the appellant had purchased the labels from M/s. Mudranika, who had done the work as per the specifications of the appellant company and supplied the labels to them printing the same according to the specifications of the appellant company. The Circular No. 715 of the CBDT dated 8-8-1995 was, therefore, clearly applicable to the facts of the appellant's case. It is further seen that the decision of the Hon'ble Supreme Court relied upon by the learned counsel, is not applicable to the facts of the appellant's case. The Assessing Officer, therefore, correctly required the appellant to pay on account of short deduction of tax and interest payable thereon. Hence no interference is required. 5. The appeal is dismissed". 5. Still aggrieved, the assessee filed further appeal. 6. The main argument of the learned counsel for the assessee was that the assessee did not deduct tax as per the provisions of section 194C from the payment made to M/s. Mudranika on account of printing and packaging material because it did not constitute works contract and was a purchase and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view of section 194C and hence the payment with respect to such material is liable to TDS. Since the assessee has failed to deduct the tax at source, therefore, the demand created by the Assessing Officer is justified and same has rightly been confirmed by the CIT(A), which needs to be confirmed further. So far as the decision of Pune Bench in the case of Wadilal Dairy International Ltd. as relied upon by the counsel of the assessee is concerned, it was submitted that there is a Full Bench decision of the jurisdictional High Court in the case of Sarvodaya Printing Press v. State of Maharasthra [1994] 93 STC 387 where the facts are identical and issue involved is almost similar with the case in hand, so, in view of this jurisdictional High Court decision, the decision of even of the same Bench of the Tribunal cannot be given preference. As the case of the assessee is almost on all fours with Bombay High Court's decision, therefore, it was pleaded for confirmation of the impugned order. 8. The learned counsel for the assessee, in order to counter the submissions of the learned D.R. has pleaded that in the case of Wadilal Dairy International Ltd. the Full Bench decision of the juris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contents as specified will cause great loss to the assessee and the same cannot be used at all and it can delay the working of the assessee which may affect adversely. Since such defective material cannot be used thus the printing is not at all incidental in this case. The principle object of the assessee is to get the material printed as per the prescribed specifications and not to purchase printed material as available in the market. The charges are composite and not separately mentioned. Under such contract the supplier party cannot retain or use the printed material and the excess, if any, was to be destroyed. The supplier party is responsible for protecting the goods and preventing them from falling into the hands of third parties. Its commercial value becomes zero in the case of rejection and it cannot be used even as a scrap. Therefore, the supply of printed material i.e. labels as per specification supplied by the supplier is not a sale but a contract involving work. Merely because sales-tax etc. was charged on the supply of material could not lead to the conclusions that it was purely purchase of goods, because the said levy has its own identity and nothing to do with inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preventing them from falling into the hands of third parties. The goods were not standard goods and were not capable of any use to any one else and thus had no commercial value. Material could not be used even as scrap if rejected and had to be destroyed. Therefore, the supply of printed material to the MPEB by the applicant was not a sale but a works contract". 11. So far as the difference between a sale and works contract is concerned, there are several decisions, which are too numerable to be noticed. The last word on the subject has been uttered in the authoritative pronouncement of the Supreme Court in the case of State of Tamil Nadu v. Anandam Viswanathan [1989] 73 STC 1. It was a case of printing and supply of question papers of the University. The Supreme Court held that though sale of paper and ink was involved, it was merely incidental. It was not a case of sale but of a works contract having regard to be done and the confidence reposed for the work to be done for remuneration. Following observations are appropriate: "The primary difference between a contract for work or service and a contract for sale is that in the former there is in the person performing or renderi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arned counsel for the assessee, is concerned, to my mind, the same looses its importance and cannot be held to be applicable in view of the jurisdictional High Court's decision as referred to above. No doubt, earlier decision of the same Bench has a persuasive value and Special Bench decisions have still more value than the Division Bench/Single Member's decision but at the same time, any decision, even if, passed by maximum numbers of Members sitting together even in a Special Bench, can be quashed/set aside/ reverse/annulled/disturbed/overruled/vacated even by a single judge of the jurisdictional High Court. As regards doctrine of precedents is concerned, the rule of judicial precedent is a salutary one and is aimed at achieving finality and homogeneity of judgments. The doctrine of binding precedent has the merits of promoting certainty and consistency in judicial decisions, and enables organic development of the law, besides providing assurance to the individual as to the consequence of transactions forming part of clear and consistent enunciation of legal principles in the decisions of a Court Union of India v. Raghubir Singh [1989] 178 ITR 548, 556-557 (SC). The Article 141 o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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