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TMI Blog1976 (8) TMI 145X X X X Extracts X X X X X X X X Extracts X X X X ..... harges, handling charges, delivery charges, postage, value of paper and value of packing materials separately in the relevant assessment years. The dispute related as to whether the taxable turnover should include the printing charges and block-making charges or not. As far as the assessment year 1966-67 is concerned, the printing charges amounted to Rs. 99,675.00 and block-making charges amounted to Rs. 2,923.95 totalling Rs. 1,02,598.95. As far as the assessment year 1968-69 is concerned, the printing charges amounted to Rs. 1,33,137.00 and block-making charges amounted to Rs. 5,361.75 totalling Rs. 1,38,498.75. The question to be considered is whether these two amounts were includible in the assessable turnover in the respective years in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the respondent and even after the change it is only the value of the paper that was liable to be included in the taxable turnover. It is the correctness of this conclusion of the Tribunal that is challenged in the form of the two revision cases preferred to this court under section 38 of Tamil Nadu Act No. 1 of 1959. We are clearly of the opinion that the contract entered into between the respondent and the Universities and the other educational institutions was a composite contract in the sense it was a contract for work and labour as well as a contract for the sale of the paper, since there was an express agreement for the sale of the paper by the respondent to the Universities and other educational institutions in question. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the printer, among other things, may enter into calculation for entrusting the job to a particular printer. But, as far as the printing of question papers of Universities and other educational institutions is concerned, matters like the technical excellence and the professional efficiency of the printer are not so material, but what motivates the contract is the capacity of the printer to keep the confidence and maintain the confidential nature of the work entrusted to the printer. Consequently, in view of this peculiar feature which will be present in the printing of matters which are confidential in nature and which will not be present in other cases, the contract in the present cases without doing any violence to logic or reasoning, can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is a composite contract for work and sale of goods; where it is of the second category, it is a contract for execution of work not involving sale of goods." In view of the demand notes prepared by the respondent in these cases showing the cost of the paper separately, the contract in the present cases must be deemed to fall in the first category referred to by the Supreme Court and, therefore, except for the material supplied on the basis of such a contract, in other respects it will continue to be a contract for work and labour and, therefore, there is no question of any liability to sales tax in respect thereof. Certainly, this reasoning of ours will cover the printing charges. Then there remains the charges for the block-making. Adm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ween the two contracts is often a fine one. A contract of sale is a contract whose main object is the transfer of the property in, and the delivery of the possession of, a chattel as a chattel to the buyer. Where the main object of work undertaken by the payee of the price is not the transfer of a chattel qua chattel, the contract is one for work and labour. The test is whether or not the work and labour bestowed end in anything that can properly become the subject of sale; neither the ownership of the materials, nor the value of the skill and labour as compared with the value of the materials, is conclusive, although such matters may be taken into consideration in determining, in the circumstances of a particular case, whether the contract ..... X X X X Extracts X X X X X X X X Extracts X X X X
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