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Judgment
Rajagopalan, J.—Though the assessee was taxed on the same baste for three years, this petition is only with reference to the assessment of
one year, 1950-51. The assesses was described as a job printer, and during the assessment year 1950-51 he was assessed to a total turnover of
Rs. 19,921-7-6. This was made up of three items :
(1) Receipt for Civil Court work .. Rs. 3,664-4-3 and binding
(2) Printing, perforating, numbering and binding charges. .. 10,194-3-6
(3) Paper used by the Press. .. 5,362-15-9
The contention of the assessee was that it was only the third item that constituted sales liable to sales-tax; but in this case, as that turnover was less
than the taxable turnover of Rs. 10,000, that item was exempted from sales-tax. With reference to items 1 and 2, the contention of the assesses
was that they did not amount to works contracts even as defined by the Sale-tax Act, but that they represent only the labour charges. Quite
Obviously that contention would apply to the second item i.e., charges for printing etc. Rs. 10,194-3-6. The contentions of the assessee, however,
was repelled by the Department, and were also rejected by the Appellate Tribunal.
The Tribunal itself found that in the bills the assessee issued to his customers other than the Court, the assessee charged the customers
separately for the paper and separately for the printing charges, we are unable to follow the reasoning of the Tribunal when it is stated :
If the customer had advanced money for the purchaser of paper separately and if the printer can show that the paper used for printing has been
specifically purchased on behalf of the customer this might probably be a case where it can be said that what the printer is paid for is only for
labour and work charges"".
The Tribunal apparently did not consider the possibility of a sale of paper by the printer himself as a dealer. When paper purchased from others
and turned over to the printer can be undoubtedly the purchaser''s property, i.e., the easterner''s property, we fail to see why a sale of paper by the
printer himself cannot make that paper the purchaser''s property, i.e., the customer''s property. If it was the customer''s paper that was used, and if
that paper was sold by the printer himself, that sale would be liable to tax if the total turnover of these sales amounted to over Rs. 10,000. But that
is not the case here. Since the assessees took tho precaution of showing the sales of paper and labour charges separately the labour charges did
not come within the scope of the definition, of works contract, and as pure labour charges they were not taxable; as the taxable turnover was
below the minimum it was not liable to be taxed.
That no doubt leaves the first item, receipt for Civil Court work Rs. 3,664-4-3. Even if this be viewed as a works contract -- and we are not
called upon to express any opinion on that at this stage -- it will be below the taxable turnover. There is therefore no need to apportion it between
cost of labour and cost of material deemed to have been sold within the meaning of the definition of ""works contract"". Even tacking it on to the
third item, the amount is below the taxable limit.
The petition is allowed and the order of the Tribunal is set aside with reference to the assessment year 1950-51. The amount in its entirety will
be treated as not liable to tax. The petitioner will be entitled to his costs, Rs. 250.