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1 - 8 of 8 (0.22 seconds)The Central Sales Tax Act, 1956
Hindustan Aeronautics Limited vs State Of Karnataka on 16 December, 1983
This is clear
from the judgment of this Court in Hindustan Aeronautics
Ltd. vs. State of Karnataka (1984 (55) STC 314 at 322)
where it was held thus : ..Mere passing of property in
an article or commodity during the course of performance of
the transaction in question does not render the transaction
to be transaction of sale. Even in a contract purely of
work or service, it is possible that articles may have to be
used by the person executing the work, and property in such
articles or materials may pass to the other party. That
would not necessarily convert the contract into one of sale
of those materials. In every case, the court would have to
find out what was the primary object of the transaction and
the intention of the parties while entering into it..
M/S. Everest Copiers Through R.A. ... vs State Of Tamil Nadu on 25 July, 1996
The Judgment in the above case was quoted with
approval by this Court in the case of Everest Copiers vs.
State of Tamil Nadu (1996 (103) STC 360) (to which judgment
one of us - Hon. Bharucha, J. - was a party) wherein it
was stated: Where the main object of the work undertaken
by the person to whom the price is paid is not the transfer
of a chattel as a chattel, the contract is one of work and
labour.
Assistant Sales Tax Officer And Ors vs B.C. Kame, Proprietor Kame Photo Studio on 14 December, 1976
This Court in Kames case (supra) while
considering the facts of a similar case held: When a
photographer like the respondent undertakes to take
photograph, develop the negative, or do other photographic
work and thereafter supply the prints to his client, he
cannot be said to enter into a contract for sale of goods.
The contract on the contrary is for use of skill and labour
by the photographer to bring about a desired result. The
occupation of a photographer, except in so far as he sells
the goods purchased by him, in our opinion, is essentially
one of skill and labour. x x x x x We, therefore, find no
cogent ground to disagree with the High Court in so far as
it has decided against the revenue and has held the contract
to be one for work and labour. Since this was a judgment
rendered prior to the coming into force of the 46th
Constitutional Amendment, we will have to consider whether
the said Amendment has brought about any change so as to
doubt the legal position enunciated in the above case. It
is true that by the 46th Constitutional Amendment by
incorporating Clause 29-A(b) in Article 366, the definition
of the words sale and works contract have been enlarged.
The State of Madhya Pradesh has also brought about a
consequent change in the definition of the word sale in
Section 2(n) of its Sales Tax Act but it is to be noticed
that in the said State Act the expression works contract
has not been specifically defined.
Section 2 in The Central Sales Tax Act, 1956 [Entire Act]
Article 286 in Constitution of India [Constitution]
Builders Association Of India & Ors. ... vs Union Of India & Ors. Etc. Etc on 31 March, 1989
The reliance placed by the
High Court in Builders case (supra) is misplaced. Though
this Court in the said case held that by the 46th Amendment
to the Constitution, the definition of the expression tax
on the sale or purchase of goods stood enlarged, it also
held that the 46th Amendment does no more than making it
possible for the States to levy sales-tax on the price of
goods and materials used in the works contract as if there
was a sale of such goods and materials. The Court also
observed : We are surprised at the attitude of the States
which have put forward the plea that on the passing of the
46th Amendment the Constitution had conferred on the States
a larger freedom than what they had before in regard to
their power to levy sales tax under entry 54 of the State
List. The 46th Amendment does no more than making it
possible for the States to levy sales tax on the price of
goods and materials used in works contracts as if there was
a sale of such goods and materials. We do not accept the
argument that sub-clause (b) of article 366(29-A) should be
read as being equivalent to a separate entry in List II of
the Seventh Schedule to the Constitution enabling the States
to levy tax on sales and purchases independent of entry 54
thereof. As the Constitution exists today the power of the
States to levy taxes on sales and purchases of goods
including the deemed sales and purchases of goods under
clause (29- A) of article 366 is to be found only in entry
54 and not outside it. We may recapitulate here the
observations of the Constitution Bench in the case of Bengal
Immunity Co. Ltd. (1955) 6 STC 446; (1955) 2 SCR 603 in
which this Court has held that the operative provisions of
the several parts of article 286 which imposes restrictions
on the levy of sales tax by the States are intended to deal
with different topics, and one could not be projected or
read into another and each one of them has to be obeyed
while any sale or purchase is taxed under entry 54 of the
State List. Thus, it is clear that unless there is sale and
purchase of goods, either in fact or deemed, and which sale
is primarily intended and not incidental to the contract,
the State cannot impose sales-tax on a works contract
simpliciter in the guise of the expanded definition found in
Article 366(29-A)(b) read with Section 2(n) of the State
Act.
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