9911796707
TMI Blog1970 (11) TMI 81X X X X Extracts X X X X X X X X Extracts X X X X ..... clocks and also undertakes repairing works. On 27th September, 1957, the concerned Sales Tax Officer, on some information, seized the account books of the assessee and thereafter passed assessment orders enhancing the turnover of sales and purchases. He further found that during the assessment years 1954-55 and 1955-56, the assessee had undertaken repair works from different customers and during the course of these repair works, it had utilised certain spare parts for the purpose of carrying out the repairs. The bills, which were supplied by the assessee to these different customers, were composite bills for the labour work done as well as for the materials utilised, but these bills, admittedly, did not specifically state what were the labo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision given by the Supreme Court in the Government of Andhra Pradesh v. Guntur Tobaccos Ltd.[1965] 16 S.T.C. 240 (S.C.)., allowed the revision application and held that the materials which were utilised by the assessee during the execution of the repair works were not sold and the property in these materials passed only incidentally. 5.. Being aggrieved by this decision of the Tribunal, the department has preferred this reference. The Tribunal has referred to this court, the following two questions for opinion: "(1) Whether on the facts and in the circumstances of the case contracts evidenced by the various bills aggregating to Rs. 9,881 for the assessment period from 1st April, 1954, to 31st March, 1955, and Rs. 7,833 for the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion for labour charges and the value of the spare parts utilised during the course of the execution of the work. These facts show very clearly that the contracts were purely for labour and that, if, during the execution of these contracts, any materials were utilised by the assessee, the supply of these materials was merely incidental to the execution of the work undertaken by the assessee. If this is so, it cannot be said that the materials which were utilised in carrying out the repair works were sold by the assessee as "materials". The case would in that case be completely covered by the ratio of the decision of the Supreme Court in Government of Andhra Pradesh v. Guntur Tobaccos Ltd. [1965] 16 S.T.C. 240 (S.C.). We may here refer to ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r consideration so far as this point is concerned. In that case, the assessees were carrying on the business of body-builders of motor chassis supplied by the customers. They entered into a contract with a firm for the construction of a body of a truck belonging to that firm. After the work was over, the assessees prepared two bills, one in respect of materials used for building the body and another for labour charges. On these facts the assessees contended that the contract in question was not a contract for sale of goods but was either (1) a purely works contract or (2) a composite agreement consisting of two distinct and separate contracts one for supply of materials and the other for doing work. On the construction of the terms of agree ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dy Builders v. Commissioner of Sales Tax, Gujarat [1971] 28 S.T.C. 339., we do not propose to discuss the facts of that case in detail. 8.. In view of this, our answer to the first question is that the contracts in question are indivisible contracts for work and labour for repairing work and not a composite agreement in which two contracts, one of labour and the other of supplying of materials is contemplated. So far as the second question is concerned it does not arise in view of the answer given by us to the first question. We accordingly dispose of this reference. The applicant-Commissioner shall bear the costs of the opponent-assessee in this reference. Reference answered accordingly. - - TaxTMI - TMITax - CST, VAT & Sales Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
