9911796707
TMI Blog1991 (6) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... ned with the assessment year 1979-80. The assessee had entered into an agreement with the Kerala State Road Transport Corporation ("the corporation" for short) on August 17, 1978, for supply of tickets at a specified rate. The assessee returned a total and taxable turnover of Rs. 12,28,189.34. The Additional Sales Tax Officer, Kunnamkulam, completed the assessment on a total and taxable turnover of Rs. 14,65,160. The assessee preferred a revision before the Deputy Commissioner, Agricultural Income-tax and Sales Tax, Trichur. He declined to interfere for the reason that patent irregularity or impropriety in the original assessment completed by the assessing authority was not noticed warranting interference under section 35 of the Kerala Gene ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The rates specified are inclusive of all costs of materials, transporting charges, taxes, if any or any other incidental charges. The short point for consideration is whether printing of tickets for the corporation can be taken to be a contract for sale of a finished product or whether it is only a contract for labour. 3.. That the contract between the assessee and the corporation is for supply of printed tickets is not disputed. According to the assessee the tickets are not finished products and the work of printing amounts to a works contract. It is pointed out that the tickets printed by the respondent cannot be sold in open market to any other person and it has no commercial value. We are referred to the decision of the Madras High Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [1989] 73 STC 1 (State of Tamil Nadu v. Anandam Viswanathan). After an exhaustive survey of the various decisions touching the subject the Supreme Court held: "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 rendering service no property in the thing produced as a whole, notwithstanding that a part or even the whole of the material used by him may have been his property. Where the finished product supplied to a particular customer is not a commercial commodity in the sense that it cannot be sold in the market to any other person, the transaction is only a works contract. " 4.. It was also observed that the nature of the contract and the trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d notes prepared by the assessee show the costs of paper separately. It appears that the assessee has treated the supply of paper separately. The Supreme Court observed that except the materials supplied on the basis of such contract the contract will continue to be a contract for work and labour and no liability to sales tax would arise in respect thereof. Attention is drawn to the statement containing the details of printing materials purchased by vouchers in the year 1979-80 attached to the trading, profit and loss account as on March 31, 1980. There is no material on record to show that paper was supplied on the basis of the agreement between the parties. In order to exclude the cost of paper the paper should have been supplied on the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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