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13. It was further held :

Whether a contract for service or for execution of work, involves a taxable sale of goods must be decided on the facts and circumstances of the case. The burden in such a case lies upon the taxing authorities to show that there was a taxable sale, and that burden is not discharged by merely showing that property in goods which belonged to the party performing service or executing the contract stands transferred to the other party.

14. In State of Orissa v. Ramanath Panda [1971] 27 STC 98 a Division Bench of the Orissa High Court held that in the case of an assessee, a printer supplying printed materials, where the customers supply paper and the assessee does nothing except printing on it, the contract is one of labour and there is no sale. Where the customer enters into an agreement that he would separately pay for the paper and the assessee would merely print on it, then also there is no sale. Where the customer does not enter into any separate agreement but merely asks the assessee to supply the printed materials, the contract is indivisible and the supply of printed materials is a sale liable to sales tax. In such a case charging separately for the paper and printing in the bill issued to the customer does not alter the essential character of the agreement, which is for the purchase of printed materials.

15. In S.R.P. Works and Ruby Press v. State of A. P. [1972] 30 STC 195 a Division Bench of the Andhra Pradesh High Court after referring to its earlier decision in the case of Krishna Power Press [1960] 11 STC 498 held that the petitioner, which was running a printing press, supplied cinema tickets printed on paper of different colours to the customers in pursuance of orders giving specifications having been placed in this behalf had done so in pursuance of a contract for purchase of tickets and not for the purchase of paper and that the property in the goods passed to the customers only when the finished goods, i.e., the tickets, were delivered to the customers and not before. It was pointed out that the fact that break-up figures were given in the bills was not decisive or conclusive in determining the question whether there were two contracts-one for supply of paper and the other for printing-or whether it was a works contract or merely an order placed for supply of finished goods.

Only in respect of those goods to which title has passed as a result of contract, can it be said that the goods have been sold. Where a person buys a 'Picasso' or a 'Ravi Varma', he does not indent to buy or pay for the canvas or the paint, although canvas and paint are involved in the production of the painting, and title to such materials is transferred to him. But such transfer of title to the materials is not pursuant to any agreement for the sale of the materials as such. It would never have been in his mind to pay separately for the materials and for the labour. What the buyer buys is a finished product which is a work of art. On the other hand, when a person gets his manuscript printed as an article or a book of verses, the printer does no more than a mechanical or technical job. The printer does not create the article or the poem, but merely renders his services to print which is in the nature of a job-work. The manuscript as such is the result of the skill, industry and scholarship of the author. In such a case, there is no sale of the article or book by the printer, nor would it be possible in such a case to spell out an agreement for the sale of materials such as paper or ink, which may have been incidentally used in the production of the printed work. While the painter sells a finished product which is a work of art, quite distinct and different from the materials used in its production, the printer merely does a job-work involving no sale; one is the work of an artist who is endowed with the finer qualities of imagination and taste and the other that of an artisan who is trained as a mechanic or technician. A printer of judgments, for example, does not produce and sell them; his work is purely that of a technician. This Court has therefore held that printing of judgments is only a works contract. The work of a printer in certain cases may involve more than printing; he may be a producer of finished articles such as bill books, vouchers and the like. When such articles are printed and sold to the cutomers, what is sold is not paper or paper products but printed materials which are finished products. Such contracts cannot be considered as contracts for the sale of paper coupled with an agreement to render service. The sale of paper had never been the subject-matter of the agreement between the parties. Like in the case of painting which is a finished product being a work of art, the bill books and vouchers are new products being printed materials; and the sale of such goods does not involve a composite contract which can be bifurcated into an agreement for the sale of goods-be they canvas and paint or paper and ink-and an agreement for work.

18. Counsel for the opposite party placed reliance on Commissioner of Sales Tax v. Kamta Press (printed at page 314 infra) 1979 UPTC 705. The facts of that case are not clear but from the answer given to the question referred it appears that it was a case where the assessee had received separate amounts towards costs of locally purchased paper and charges for printing. The question as to whether the whole transaction constituted a single contract and the sale of printed materials, was as such of finished goods does not seem to have been either argued or considered. The decision of the Division Bench of this Court in the case of Kanpur Journals Ltd. [1956] 7 STC 661 also does not appear to have been brought to the notice of the learned single Judge who decided this case.