Sale requires transfer of property: stone supply contract was not taxable, and writ jurisdiction remained available.

A supply arrangement for collecting, breaking and delivering stone did not amount to a sale because property in the goods remained with the State and royalty for collection did not transfer ownership; sales tax was therefore not attracted. The Court also held that writ relief was maintainable against notices and the assessment order, since the notices were not determinative orders and the tax demand, lacking legal authority on a non-taxable transaction, fell within constitutional writ jurisdiction. The alternative-remedy bar under article 226(3) was accordingly inapplicable. The assessment and consequential notices could not stand and the matter was remitted for fresh decision in accordance with law.

---

---

Issues: (i) Whether the supply of stone materials under the contract amounted to a sale exigible to sales tax under the Bengal Finance (Sales Tax) Act, 1941. (ii) Whether the writ petition and challenge to the assessment order and notices were barred by the substituted article 226 of the Constitution of India on the ground of alternative remedy.

Issue (i): Whether the supply of stone materials under the contract amounted to a sale exigible to sales tax under the Bengal Finance (Sales Tax) Act, 1941.

Analysis: The contract showed that the petitioner was engaged to collect stone from the river-bed, break it into specified sizes, and deliver it to the Public Works Department. The stones were all along treated as property of the State and the payment of royalty for collection did not transfer ownership to the petitioner. Applying the principle that a sale requires transfer of property in goods, the transaction could not be treated as a sale. The reasoning followed the settled distinction between a mere supply or processing arrangement and a sale of goods.

Conclusion: The transaction was not a sale and was not liable to sales tax on that basis, in favour of the petitioner.

Issue (ii): Whether the writ petition and challenge to the assessment order and notices were barred by the substituted article 226 of the Constitution of India on the ground of alternative remedy.

Analysis: The impugned notices were held not to be assessment orders or orders determining rights and therefore did not fall within the revisional or review provisions relied upon by the Revenue. As regards the assessment order, the levy was found to be without authority of law because no taxable sale existed. A tax demanded without legal authority was treated as an infringement of the constitutional protection against deprivation of property without authority of law, bringing the matter within article 226(1)(a). On that footing, the bar under article 226(3) was held inapplicable.

Conclusion: The petition was maintainable and was not barred by article 226(3), in favour of the petitioner.

Final Conclusion: The assessment and consequential notices could not stand, and the matter was sent back for fresh decision according to law on the limited footing indicated by the Court.

Ratio Decidendi: A transaction is not a sale unless property in the goods passes from the seller to the buyer, and a tax demand raised without legal authority on a non-taxable transaction may be challenged in writ jurisdiction notwithstanding the alternative-remedy bar.

---