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TMI Blog1966 (7) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... ectively was accepted, being the lowest. This acceptance was conveyed to him by the Executive Engineer, District Division (South), Public Works Department (B R), jodhpur, by his letter No. 10924 dated the 17th July, 1958 (exhibit 1), wherein it was clearly mentioned that "the 'chokhats' will have to be supplied and fixed at site along with the masonry work." Thereafter It appears to us that a formal agreement should normally have been executed between the petitioner and the department, but that has not been brought on the record. Apart from the letter of acceptance (exhibit I) to which we have made reference above, the petitioner has brought on this record a certified copy of the tender submitted by him, and which was accepted by the department (exhibit 2), in which It has been mentioned that the contract was for joinery and painting work in connection with the construction of a police lines building at Pali and that the amount tendered by the petitioner for this entire work was Rs. 1,81,528. The assessee then filed a return for the assessment year 1959-60 and the Sales Tax Officer eventually passed the assessment order (exhibit 3) on the 24th August, 1961, which Is Impugned befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at site and did not and cannot amount in law to a sale of goods as such within the meaning of the Act. It is also contended that the property in the articles supplied by him to the State did not pass from the petitioner to the latter until they were actually fastened on the spot and, therefore, up to that time there was no sale, and after they were so fastened, they became immovable property belonging to the State and could in no way be held liable to sales tax on the footing that there was any sale of the goods as such. This application has been opposed by the respondents. The principal grounds taken by them in their opposition are first that the petitioner had alternative remedies under the Act and that having failed to resort to them, this Court should not entertain the present writ application, and second, that the contract performed by the petitioner for which he has been made to pay sales tax was divisible into a contract for supply of materials and for skill and labour, and it is, therefore, prayed that the petitioner was rightly taxed and his petition deserves to be dismissed. We shall take up the preliminary objection first. The contention raised by the respondents in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngh v. The State of Rajasthan(1) and M/s. Karam Chand Thappar v. Sales Tax Officer(2). On a careful and anxious consideration of the rival contentions on this aspect of the case, we are inclined to hold the view that generally speaking the High Court will not interfere in cases of this kind brought to Its notice under Article 226 of the Constitution until and unless the aggrieved party resorts to and exhausts the various remedies which are open to him under the Act whereunder he has been assessed to a certain amount of tax. But, at the same time, this rule cannot be accepted as one of universal application, and there clearly appears to us to be certain well-recognised exceptions thereto both according to the decisions of this Court as well as of the Supreme Court. Thus in Thakur Ranjeet Singh's caseI.L.R. (1953) 3 Raj. 150., it was held by a Bench of this Court (Wanchoo, C.J., and Bapna, J.), that where the levy of a tax is Itself illegal or where the law imposing the tax is ultra vires the matter should be decided as early as possible, and if the party, in such a case, comes to the High Court under Article 226 it will interfere by way of writ even though another remedy of suit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rnment Advocate vehemently submitted that the view that he presses for our consideration and acceptance receives strong support from the decision of the Supreme Court in Sales Tax Officer v. M/s. Shiv Ratan[1965] 16 S.T.C, 599; A.I.R. 1966 S.C. 142. This case went in appeal to the Supreme Court from a Bench decision of this very Court in a sales tax matter. The assessee's contention before the Sales Tax Officer was that it was not liable to be assessed to sales tax because it was not a dealer within the meaning of the Act with respect to its turnover and further because the sales had been made in the course of import within the meaning of Article 286(1)(b) of the Constitution. The Sales Tax Officer held that it was a dealer but did not address himself to the question raised by the assessee that the sales were made in the course of import under Article 286(1)(b) of the Constitution and proceeded to make the assessment order. The assessee then filed a petition before this Court under Article 226 of the Constitution praying (1) that the finding of the Sales Tax Officer that it was a dealer was erroneous and (2) that the Sales Tax Officer had entirely failed to consider the impact and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... act. In the second place, their Lordships themselves quashed the assessment order made by the Sales Tax Officer and ordered a remand of the case to him for the decision on the point under Article 286 of the Constitution. Furthermore, it would be going too far to hold on the authority of this case that under no circumstances the High Court should entertain a writ application under Article 226 of the Constitution regarding a matter under the Act unless the assessee has exhausted all his remedies under it. For, Immediately after the passage we have extracted above, their Lordships were pleased to make the following further observations: "There must be something more in a case to warrant the entertainment of a petition under Article 226, something going to the root of the jurisdiction of the Sales Tax Officer, something to show that it would be a case of palpable injustice to the assessee to force him to adopt the remedies provided by the Act." Now, in saying all this, their Lordships were obviously not making an exhaustive statement of the cases where interference by the High Court under Article 226 was or would be permissible, and their observations are merely illustrative and thes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of H.P.A.I.R. 1954 S.C. 415. We would also like to Invite attention in this connection to Calcutta Discount Co. Ltd. v. Income-tax Officer[1961] 41 I.T.R. 191; A.I.R. 1961 S.C. 372. In this case one of the contentions of the assessee was that the conditions precedent for the assumption of jurisdiction under section 34 of the Income-tax Act were not at all satisfied, and, therefore, the Income-tax Officer had no jurisdiction to proceed under that section and preferred an application under Article 226 of the Constitution to the High Court. It was objected on behalf of the revenue that the assessee would have sufficient opportunity to raise that question, namely, whether the Income-tax Officer had reason to believe that under-assessment had resulted from non-disclosure of material facts before the Income-tax Officer himself in the assessment proceedings, and if unsuccessful there, before the appellate officer or the Appellate Tribunal or in the High Court under section 66(2) of the Indian Income-tax Act. Their Lordships, however, repelled this plea holding that the existence of such alternative remedy was not always a sufficient reason for refusing a party quick relief by a writ or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we did not give the necessary relief to the petitioner on account of the mere fact that he failed to exercise all the statutory remedies available to him under the Act or again that his present application to this Court was a little more delayed than it need have been. In the view of the matter we take, the preliminary objection fails and it is hereby dismissed. This brings us to the merits of the case. Now before we deal with this aspect, we may by way of clearing the ground mention that according to the Sales Tax Officer, the sale of materials allegedly made by the petitioner for the period under assessment in this case amounted to Rs. 1,97,212. Out of this the petitioner has confined his claim before us to a turnover of Rs. 1,81,528 only which was the amount tendered by him for the execution of the joinery and painting work in connection with the police lines building at Pali. No material has been brought to our notice so far as the balance of the turnover, namely, Rs. 15,684 is concerned. Our judgment will, therefore, be confined to the turnover of Rs. 1,81,528 only for which the petitioner has been assessed to sales tax by the assessment order which is impugned before us. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was filed by him before the Sales Tax Officer on the 19th May, 1961. This certificate also proceeds from the Executive Engineer and bears the date 17th May, 1961, and reads as follows: "This is to certify that M/s. Nenuram Kisnaram contractor jodhpur has received payment of Rs. 1,66,860 against the following work for 1958-59-60 from this division: 1.. Constructing police lines building at Pali-Rs. 1,66,860. The aforesaid amount was for the execution of contract of wood work. The agreement was for supplying and fixing, that is, both. There was no agreement for supplying only." It appears from the reply filed by the respondents that even this certificate was not considered to be complete and, therefore, the Sales Tax Officer, after looking into the books of account of the petitioner, came to the conclusion that "the price has been charged for jories and chokhats which are movable and taxable. In other words sale of materials of Rs. 1,97,212.00 was made". The Sales Tax Officer does not appear to us to have come to grips with the contention of the petitioner that the contract for the supply and fixing of the doors and windows and the frames therefor at site was a single and indivi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of goods. It was further held that where by virtue of a composite contract, plants and machinery are fixed in the land of the employer by a contractor, which work involves the application of technical skill, and the employer agrees to give and the contractor to take an all inclusive price, then such a contract is an Indivisible works contract and is not a contract of sale of goods as such. This decision seems to us to apply with full force to the case before us and is binding on us. Apart from this, we would invite attention to the cases referred to with approval by their Lordships of the Supreme Court in their judgment in Dunkerley's case[1958] 9 S.T.C. 353; A.I.R. 1958 S.C. 560. in paragraphs 39 to 42 thereof and in particular to the case of Tripp v. Armitage(1839) 4 M. W. 687; 150 E.R. 1597., in support of the conclusion to which we have come. There one Bennett, a builder, had entered into an agreement with certain trustees to build a hotel. The agreement provided, inter alia, that the articles which were to be used for the structure had to be approved by the trustees. Thereafter Bennett became bankrupt. A dispute arose between his assignees in bankruptcy and the trustees as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e immovable property of the employer on the principle of accretion and not because of any contract for sale of goods as movables and, therefore, there were no goods which could become the subject-matter of sale at that stage within the meaning of the Sale of Goods Act. This was the position in Man Industrial Corporation's caseI.L.R. (1965) 15 Raj. 698; 17 S.T.C. 152. , and that is so as well here. Our conclusion, therefore, is that in so far as the petitioner was assessed to sales tax for the execution of the contract in question, the assessment is invalid and must be quashed. We, therefore, allow this application and quash the assessment order dated the 24th August, 1961, in part, that is, in so far as the petitioner has been assessed to sales tax thereunder for supply and fixture of wooden windows and doors and frames therefor in connection with the construction of the police lines building at Pali during the accounting year 1st April, 1959, to 31st March, 1960. As this assessment order appears to us to have been made with respect to certain other sales also during the accounting period in question, it will be for the Sales Tax Officer to separate the turnover relating to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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