Retreading charges as works contract, not sale, so sales tax could not be levied on tyre retreading receipts.

Retreading customers' old tyres was treated as a works contract for carrying out labour and not as a sale transaction, so the charges for retreading did not attract sales tax because no element of sale was present. The Court also noted that the amount collected as sales tax and remitted to the Government formed part of the aggregate assessed turnover only for the limited question before it. The levy on the retreading charges was therefore set aside to that extent, and the revision was allowed only in part.

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Issues: Whether the assessee was liable to sales tax on the amount charged for retreading customers' old tyres and on the sales tax collected from customers and remitted to the Government.

Analysis: The retreading activity was held to be a contract for carrying out work, and not a transaction involving sale. In the absence of an element of sale, the turnover attributable to the retreading charges could not attract sales tax. The amount collected as sales tax and remitted under section 8-B of the Sales Tax Act formed part of the aggregate assessed turnover for the limited question before the Court.

Conclusion: The assessee was not liable to sales tax on the retreading charges, and the levy on the aggregate amount was set aside to that extent. The revision petition was allowed only in part.

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