Sales tax exemption for packing materials and composite printing contracts turns on purchaser authorisation and proof of divisible contracts.

Exemption for sales of wrappers, cartons and labels to registered purchasers depended on whether the buyers' registration certificates authorised purchase of those packing materials for the stated purpose; because the record was incomplete and the purchasers' registration entries were not fully examined, the matter was remitted for fresh consideration and, where justified, declarations in the prescribed form. Labour charges shown for printing were not excluded from taxable turnover because the dealer failed to prove separate and divisible contracts for printing and supply; in the absence of agreements, work orders or account books, the transaction was treated as composite and the charges remained taxable.

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Issues: (i) Whether the claim for exemption on sales of wrappers, cartons and labels to registered purchasers was allowable under the sales tax exemption provisions. (ii) Whether the amount shown as labour charges for printing could be excluded from taxable turnover.

Issue (i): Whether the claim for exemption on sales of wrappers, cartons and labels to registered purchasers was allowable under the sales tax exemption provisions.

Analysis: The exemption depended on whether the purchasing dealers were in fact authorised by their registration certificates to buy the relevant packing materials for the stated purpose. The existing record was incomplete, the lower authorities had not fully examined the registration entries of all purchasers, and further particulars were required before a final conclusion could be reached.

Conclusion: The matter was remitted to the Sales Tax Tribunal for fresh examination of the purchasers' entitlement to buy wrappers and cartons and to issue declarations in the prescribed form, if warranted.

Issue (ii): Whether the amount shown as labour charges for printing could be excluded from taxable turnover.

Analysis: The dealer supplied its own materials and undertook printing in its own press, but failed to produce agreements, work orders, or account books to show that the printing and supply components were separately and divisibly contracted. In the absence of such material, the contract was treated as composite and the precedent governing similar facts was applied.

Conclusion: The labour charges were held to form part of the taxable turnover and were not excludable.

Final Conclusion: The reference succeeded only to the extent that the first question was sent back for reconsideration, while the treatment of printing charges as taxable turnover was upheld.

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