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A.A. Jariwala And Bros. vs The State Of Gujarat on 16 November, 1964 cites

The State Of Madras vs Gannon Dunkerley & Co.,(Madras) Ltd on 1 April, 1958

8. pairing it, title to that motor accessory passes when the repairer delivers the car to its owner; but to constitute a sale of that part it is necessary to have an agreement between the parties for the sale of that accessory. Therefore whether in a particular case there is a contract of sale of materials as distinct from a pure works contract would depend upon the agreement between the parties and on proof of an intention to sell the materials as such. If the essential intention of the parties is to have the car repaired, the manufacture of a particular chattel can only be incidental to the repair and not one for the sale of it. The case nearest to the one before us is to be found in Appasamy and Sons v. The State of Madras ([1959] 10 S.T.C. 170), where, following the decision in Gannon Dunkerley's case, ([1958] 9 S.T.C. 353), the Madras High Court held that the charges collected by the assessee for carrying out embroidery work On the materials supplied to him by his customers could not be assessed to sales tax inasmuch as such contracts did not include the sale of any goods of the assessee to the customers.
Supreme Court of India Cites 38 - Cited by 719 - Full Document

Sundaram Motors (Private) Ltd., 37 ... vs The State Of Madras, Represented By ... on 2 September, 1958

This is illustrated by the decision of the High Court of Madras in Sundaram Motors (Private) Ltd. v. The State of Madras ([1958] 9 S.T.C. 687). The assessee there was a private limited company carrying on business in selling and distributing motor vehicles. It also dealt in motor parts and accessories and maintained a workshop where reconditioning or repairs of motor vehicles were undertaken. The turnover in the business of the company, therefore, related to the sales department where goods were sold and also to the works department where the vehicles were repaired or reconditioned. In the latter case, the turnover represented not only the labour charges as such, but also the cost of spare parts or materials supplied or used in effecting the repairs. There was no controversy with regard to the turnover in the sales department, but the question arose as regards the turnover in the works department. For the assessment year 1949-50, which was taken in that case as typical one, the Deputy Commercial Tax Officer assessed the turnover of the company in the total amount of Rs. 42,13,684 out of which he allocated a sum of Rs. 2,63,462 as turnover in respect of works contracts referable to repairs of motor vehicles in the workshop. Out of the latter amount, he held that a sum of Rs. 2,16,548 should be treated as turnover in respect of works contracts, and levied a tax on seventy per cent. thereof as representing the sales of materials to the customers while executing the works, repairs, etc. The company questioned the assessment adopted by the authorities on the workshop transactions and the High Court accepting their contention, held that in the circumstances of the case, charges for the fabricated materials should be treated as charges in respect of the works contract and not independent sales of those materials. The learned Judges observed that the State had no power to tax a works contract as such, though there would be no impediment in levying tax on the sale of goods properly so-called and, therefore, if a works contract included sale of goods, the levy of tax on such sale would be proper. If, on the other hand, the contract was only a works contract with no element of sale of goods, it would not be taxable. They further observed that it could not be held as a general proposition that in every case of a works contract there was necessarily implied a sale of the component parts which go to make up the repair. That question would depend on the facts of each case. To constitute a sale of goods, in addition to a transfer of movable property, two more elements at least would be necessary : (1) There should be an agreement between the parties to sell and purchase, and (2) that agreement should be with reference to the particular goods.
Madras High Court Cites 4 - Cited by 20 - Full Document

United Bleachers Ltd. vs The State Of Madras on 7 December, 1959

Another decision which might be usefully referred to is United Bleachers Ltd. v. The State of Madras ([1960] 11 S.T.C. 278). This case related to a contract of bleaching grey cloth which also involved packing of the goods after the bleaching was done, and the question which arose was whether in such a case there could be said to be an implied sale of the packing materials. Rajagopalan and Ramachandra Iyer, JJ., again emphasized that in such a case, in order that there could be a levy of sales tax, there should be a sale and that mere passing of title in the goods, which was not as a result of any contract between the parties to sell either express or implied, could not amount to a sale. Whether in regard to packing materials utilised in the performance of a contract between the parties there was a sale, would depend on the agreement between the parties. Such an agreement could be express or implied. Where the main contract was one of sale of goods as packed, such an agreement to sell the packing materials could, having regard to the nature of the contract, be readily implied; but where the main contract was merely one of service, the fact that in the performance of such service packing materials were used and charged for, would not lead to a necessary inference that a sale of the materials was intended. They also emphasized that in such a case, the onus would be on the taxing authority to prove that there was an agreement to sell packing materials and a sale by the passing of property therein. On the facts of that case, the learned Judges held that the contract before them was one for service, namely, bleaching, dyeing, etc. But as part of the service, the goods bleached or the dyed articles had to be packed and delivered. They observed however that from that, it would not necessarily follow that there could be no sale of packing materials, whenever such material was used in connection with the performance of a contract of service. It may be that there might be a distinct contract of sale with regard to packing materials. The question whether there were in a particular case two distinct contracts, one for service and another for sale of the packing materials, would depend on the evidence. Where, however, there are no such distinct contracts, i.e., where the contract is one and indivisible, and the essential portion of that contract is one for service or labour, the question whether the use of the packing materials also charged for in rendering the service would amount to a sale or not, would depend on the intention of the parties. Packing itself might be part of the service stipulated, and the fact that certain materials had to be utilised in rendering that service, might not always mean that there was a sale of the packing materials and it might be that packing was incidental to service. The learned Judges there came to the conclusion that the principal contract between the parties was one for service. The packing materials were necessary as an incident to that service and, therefore, although property in the packing materials might have passed to the customers and the price therefor had also been included for charging for service, there being no agreement to purchase the packing materials which could be implied in the case, there would be no sale of packing materials.
Madras High Court Cites 8 - Cited by 14 - Full Document

Guntur Tobaccos Ltd., Guntur vs Government Of Andhra (Now Andhra ... on 21 April, 1961

A similar case of packing materials is also to be found in Guntur Tobaccos Ltd. v. The Government of Andhra ([1961] 12 S.T.C. 668), where, on the footing that the contract of work of redrying tobacco, its storage for the requisite period and packing such redried tobacco was one and integral with procedure of redrying, it was held that an agreement of sale of packing materials could not be implied. Though the test suggested there might not appear to be a determinative test, for that would equally apply even to a pure works contract, the decision really turns on the footing that the contract was a service contract, was one and indivisible and the supply of packing materials was ancillary to the contract of work and service.
Andhra HC (Pre-Telangana) Cites 11 - Cited by 6 - Full Document

Appasamy And Sons vs The State Of Madras on 2 September, 1958

8. pairing it, title to that motor accessory passes when the repairer delivers the car to its owner; but to constitute a sale of that part it is necessary to have an agreement between the parties for the sale of that accessory. Therefore whether in a particular case there is a contract of sale of materials as distinct from a pure works contract would depend upon the agreement between the parties and on proof of an intention to sell the materials as such. If the essential intention of the parties is to have the car repaired, the manufacture of a particular chattel can only be incidental to the repair and not one for the sale of it. The case nearest to the one before us is to be found in Appasamy and Sons v. The State of Madras ([1959] 10 S.T.C. 170), where, following the decision in Gannon Dunkerley's case, ([1958] 9 S.T.C. 353), the Madras High Court held that the charges collected by the assessee for carrying out embroidery work On the materials supplied to him by his customers could not be assessed to sales tax inasmuch as such contracts did not include the sale of any goods of the assessee to the customers.
Madras High Court Cites 1 - Cited by 3 - Full Document
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