https://www.taxtmi.com/caselaws?id=100781 The true nature of a contract depends on its substance and surrounding circumstances, not merely its label. Where railway coaches were manufactured for the Railway Board using materials that belonged to the Railway before use, and the assessee was paid for the manufacturing service, the arrangement was treated as a pure works contract. The Court noted that the Railway had booked capacity, supplied key components in part, advanced most of the material value, and treated procured materials as its property under indemnity arrangements. The difference between contract price and material cost represented service charges only, so the turnover was not liable to sales tax under the Central Sales Tax Act. en-us Fri, 17 Dec 1971 00:00:00 +0530 Tue, 20 May 2014 15:46:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=100781 The true nature of a contract depends on its substance and surrounding circumstances, not merely its label. Where railway coaches were manufactured for the Railway Board using materials that belonged to the Railway before use, and the assessee was paid for the manufacturing service, the arrangement was treated as a pure works contract. The Court noted that the Railway had booked capacity, supplied key components in part, advanced most of the material value, and treated procured materials as its property under indemnity arrangements. The difference between contract price and material cost represented service charges only, so the turnover was not liable to sales tax under the Central Sales Tax Act. Case-Laws VAT and Sales Tax Fri, 17 Dec 1971 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=100781