Works contract characterization for printed tickets excludes sales tax where goods are made to specification and not marketable as ordinary stock.

A contract to print and supply tickets to a corporation was treated as a works contract rather than a sale of goods liable to sales tax. The printed tickets were to be produced to specified requirements and used only by the corporation, so the finished product was not a commercial commodity for open-market sale. On that basis, the transaction was characterised as work and labour with materials used in execution, and the amount was rightly excluded from taxable turnover. The contention that paper cost should be separately assessed was rejected because there was no proof that paper was supplied under the contract.

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Issues: Whether the contract for printing and supplying tickets to the corporation was a sale of goods exigible to sales tax or a works contract not liable to tax.

Analysis: The contract required the assessee to print and supply tickets according to specified specifications, and the printed tickets were intended for use only by the corporation. The finished product was not a commercial commodity capable of sale in the open market to others. In such circumstances, the transaction was treated as one of work and labour with materials used in execution, rather than a sale of goods. The Tribunal's view that the amount should be excluded from taxable turnover was therefore found correct, and the contention that paper cost had to be separately assessed was rejected for want of proof that paper was supplied under the contract.

Conclusion: The transaction was a works contract and not a taxable sale of goods; the revision petitioner failed.

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