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TMI BlogStatement of Objects and ReasonsX X X X Extracts X X X X X X X X Extracts X X X X ..... the Seventh Schedule to the Constitution has the same meaning as in the Sale of Goods Act, 1930. This decision related to works contracts. 2. By a series of subsequent decisions, the Supreme Court has, on the basis of the decision in Gannon Dunkerley's case, held various other transactions which resemble, in substance, transactions by way of sales, to be not liable to sales tax. As a result of these decisions, a transaction, in order to be subject to the levy of sales tax under entry 92A of the Union List or entry 54 of the State List, should have the following ingredients, namely, parties competent to contract, mutual assent and transfer of property in goods from one of the parties to the contract to the other party thereto for a pric ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le as such club or association, in law, has no separate existence from that of the members. In the Associated Hotels of India case (A.I.R. 1972 S.C. 1131) = 1972 (1) TMI 80 - SUPREME COURT, the Supreme Court held that there is no sale involved in the supply of food or drink by a hotelier to a person lodged in the hotel. 4. In the New India Sugar Mills case (A.I.R. 1963 S.C. 1207) = 1962 (11) TMI 21 - SUPREME COURT, the Supreme Court took the view that in the transfer of controlled commodities in pursuance of a direction under a Control Order, the element of volition by the seller, or mutual assent, is absent and, therefore, there is no sale as defined in the Sale of Goods Act, 1930. However, in Oil and Natural Gas Commission Vs. State of B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g to the outright sale of a film, only a leased or transfer of the right to exploitation is made. 7. There were reports from State Governments to whom revenues from sales tax have been assigned, as to the large scale avoidance of Central sales tax leviable on inter-State sales of goods through the device of consignment of goods from one State to another and as to the leakage of local sales tax in works contracts, hire-purchase transactions, lease of films, etc. Though Parliament could levy a tax on these transactions, as tax on sales has all along been treated as an item of revenue to be assigned to the States, in regard to these transactions which resemble sales also, it is considered that the same policy should be adopted. 8. Besides th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the right to use any goods for any purpose for cash, deferred payment or other valuable consideration; (v) the supply of goods by an unincorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration; (vi) the supply, by way of or as part of any service, of food or any drink for cash, deferred payment or other valuable consideration. (See clause 4). 10. A new entry is sought to be inserted in the Union List in the Seventh Schedule, as entry 92B, to enable the levy of tax on the consignment of goods where such consignment takes place in the course of inter-State trade or commerce. (See clause 5). 11. Clause (1) of article 269 is proposed to be amended so that the tax levied on the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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