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Variety Body Builders vs Commissioner Of Sales Tax, Gujarat on 9 November, 1970 cites

Patnaik & Company vs State Of Orissa on 19 January, 1965

Shri Shah pointed out to us that so far as the case under our consideration is concerned, it was the assessee who was the owner of the body which was built with the help of his own materials and labour and since the property in the form of coaches eventually passed to the railway administration on payment of the agreed amount of Rs. 19,141 per unit, it should be held, on the ratio of the decision of the Supreme Court in Patnaik's case ([1965] 16 S.T.C. 364 (S.C.)), that the contract between the parties, before us, was a contract for sale of goods qua goods and not a contract for work. We find that it cannot be disputed that in both the cases which are relied upon by Shri Shah, the contracts were found to be contracts for selling goods and it is also not possible to dispute that the main aspect, which has weighed with the majority of the learned Judges, who have decided this case, is that property in the goods passed from the assessee to the State only at the end of the execution of the work undertaken by the assessee and on payment of the consideration of the amount, as stipulated in the contract.
Supreme Court of India Cites 13 - Cited by 51 - J C Shah - Full Document

Carl Still G. M. B. H. & Another vs The State Of Bihar And Others on 19 April, 1961

A view similar to this is taken by the Supreme Court in another case of Carl Still G.m.b.H. and Another v. State of Bihar and Others ([1961] 12 S.T.C. 449 (S.C.)) wherein a contract to set up a complete coke oven battery ready for production and to erect buildings, plants and machineries, was held to be an entire and independent contract for construction of specified works for a lump sum and not a contract of sale of materials as such.
Supreme Court of India Cites 23 - Cited by 65 - Full Document

Chander Bhan Gosain vs State Of Orissa & Ors on 5 April, 1963

29. The third decision of the Supreme Court on this point is found in the case of Chandra Bhan Gosain v. The State of Orissa and Others ([1963] 14 S.T.C. 766 (S.C.)). The facts of that case were that the assessee was manufacturing and supplying large quantities of bricks to a company under a contract. The assessee was assessed to sales tax under the Orissa Sales Tax Act, 1947, on the basis that these supplies were sales. One of the clauses of the contract provided that the land would be given free by the company. The contention of the assessee was that the contract was only for labour and that there was really no sale of any goods on which the tax could be levied. On these facts, the Supreme Court held that under the contract there was a transfer of property in the earth to the assessee by the company concerned and that the essence of the contract was the delivery of the bricks and, therefore, it amounted to a contract for transfer of chattel qua chattel. It is obvious that this case was decided on its own facts. In this reference we are considering a case in which the contract between the parties contains various clauses going to show that it was a contract mainly for labour. In our view, therefore, even this decision given by the Supreme Court in Chandra Bhan Gosain ([1963] 14 S.T.C. 766 (S.C.)), would not be of any help to the department.
Supreme Court of India Cites 3 - Cited by 59 - A K Sarkar - Full Document

Commissioner Of Sales Tax M.P. vs Purshottam Premji on 13 April, 1970

31. While applying this ratio to the facts of the case under our consideration, the first question which would arise for consideration is whether the commodity which the assessees have produced in execution of the contract was their sole property which they could have transferred as such. One test which is accepted by the Supreme Court in the case of Commissioner of Sales Tax, M.P. v. Purshottam Premji ([1970] 26 S.T.C. 38 (S.C.)), to ascertain whether a given contract is for work or for sale of goods, is to ascertain whether the thing produced as a whole had individual existence as the sole property of the party who produced it at some time before delivery and the property therein passes only under the contract relating thereto to the other party for price. If the thing has no independent existence as the sole property of the party producing it, the contract would be one for work and service. This becomes clear from the following observations of Hegde, J., in the above referred case of Purshottam Premji ([1970] 26 S.T.C. 38 (S.C.)) :
Supreme Court of India Cites 2 - Cited by 48 - K S Hegde - Full Document

State Of Rajasthan vs Man Industrial Corporation Ltd on 4 February, 1969

32. We further find that the facts of the present case are completely covered by the ratio of two other decisions of the Supreme Court, one given in the case of The State of Madras v. Richardson & Cruddas Ltd. ([1968] 21 S.T.C. 245 (S.C.)), and the other in the case of State of Rajasthan v. Man Industrial Corporation Ltd. ([1969] 24 S.T.C. 349 (S.C.)). In Richardson & Cruddas Ltd. ([1968] 21 S.T.C. 245 (S.C.)), the assessee who worked as engineers, contractors and dealers in iron and steel as well as refrigerating and cooling units, entered into a contract with a co-operative society for fabrication, supply and erection of steel structures for a sugar factory in the State of Mysore. On execution of this contract, the assessee received the sum of Rs. 3,26,075.20 which was included in the turnover for the assessment to Central sales tax. There was no formal contract but the agreement between the parties had to be ascertained from the correspondence between them and on consideration of the correspondence between the parties the High Court of Madras concluded as under :
Supreme Court of India Cites 6 - Cited by 50 - J C Shah - Full Document

Commissioner, Sales Tax vs Noorullah Ghazanffurullah on 10 February, 1969

34. We find that the decision concerning the facts, which are almost similar to the facts of the present case, is the one given by the Allahabad High Court in Commissioner of Sales Tax, U.P. v. Noorullah Ghazanffurullah ([1970] 26 S.T.C. 100). In that case the assessee was a firm of contractors, which had entered into a contract for building railway coaches for North Eastern Railway on the underframes supplied by the railway. The coaches were to be built according to the specifications and drawings annexed to the agreement on a siding within the railway yard for which the assessee had to pay a nominal rent of one rupee per month, as is the case even of the assessee before us. The assessee was to receive for each coach lump sum payment plus another sum for fixing dynamo, suspension, gear etc. The lump sum was inclusive of the cost of all materials and labour charges for building, furnishing, finishing and polishing. The contract was to be completed within the stipulated time but was liable to be determined if the execution was inefficient or the progress of the work was so slow that the work would not be completed in time. The Chief Mechanical Engineer of the railway had also a right to vary or alter the specifications at any time and the assessee was bound to carry out that order. The said engineer could also suspend the work for such period as he thought fit, and the contract was liable to determination if the assessee became insolvent or suspended payment or compounded with its creditors, as is the case before us. On these facts, both the learned Judges of a Division Bench of the said High Court have taken a view that the contract was not a contract for sale of goods but was a works contract and was therefore not liable to sales tax. By reference to the separate judgments recorded by both the learned Judges of the said Division Bench, we find that most of the important clauses of the contract, which they considered were quite similar to the important clauses of the contract before us. On a consideration of these clauses, the learned Judges have come to the conclusion as stated above. On the question whether the whole of the coach including the underframe would at any time become the sole property of the assessee-contractor, we find the following pertinent observations made by Pathak, J., in his separate judgment :
Allahabad High Court Cites 11 - Cited by 2 - R S Pathak - Full Document
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