TaxTMI 
TaxTMI 
1965 (1) TMI 49
X X X X Extracts X X X X
X X X X Extracts X X X X
....GADKAR, C.J., HIDAYATULLAH, SIKRI and BACHAWAT, JJ., was delivered by SIKRI, J. SHAH, J., delivered a separate judgment: SIKRI, J.-This is an appeal by special leave directed against the judgment of the Bombay High Court in a reference made to it under section 34 of the Bombay Sales Tax Act, 1953. One of the questions referred to the High Court was "whether the transaction referred to in bill dated 29th June, 1955, is liable to sales tax under the Bombay Sales Tax Act, 1953. " The appellant, M/s. McKenzies Limited (hereinafter referred to as the appellant), who are engaged in the business of body-building on motor chassis, entered into a contract for the construction of 218 bodies with the Government of India. The price agre....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ct, 1953." The Bombay High Court answered both the questions in the affirmative. The appellant having obtained special leave to appeal, the appeal is now before us. This appeal was heard along with the appeals in M/s. Patnaik & Co. v. The State of Orissa C.A. Nos. 179-181 of 1964-Judgment delivered on January 19, 1965; since reported at page 364 supra., in which we have just delivered judgment. As we have stated in that case, the answer to the second question, which was the only question argued before us, depends upon the intention of the parties, to be gathered from the agreement. The High Court, on the construction of the agreement, has come to the conclusion that it was a contract of sale rather than a contract for work and labour. The....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the bodies passes to the Government on delivery, and when the property passes the bodies are goods. The fact that a progress report had to be given only ensured prompt delivery. There is no clause in the agreement which militates against the contract being a contract for the sale of goods. The appeal accordingly fails and is dismissed with costs. SHAH, J.-I am of the view that the contract between the Government of India and the appellants is a contract for work and not for sale. The important terms and conditions which persuade me to take that view are: (1) The contract is for construction of "G.S. composite bodies on chassis supplied by the Government delivered with canvas components". (2) The appellants are under a duty to submit a fo....