1961 (8) TMI 18

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....circles wrought out of the aluminium scraps as sales and estimated the turnover value of such sales at Rs. 1,35,355-13-0. As against this sales turnover he allowed the labour charges of Rs. 44,855-9-9 and arrived at the net turnover. The assessees preferred an appeal before the Special Commercial Tax Officer, Madras City, and one of the objections raised by them before the appellate authority was that the supply of aluminium circles as against the aluminium scrap received from the constituents, who were supplied with the circles, was not a sale under the Madras General Sales Tax Act, and that there could be no assessment in respect of it. This contention was however negatived by the appellate authority. There was a further appeal before the....

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....issued to the customers for the payment of these charges. The account books of the assessees show the weight of aluminium circles delivered. It has been pointed out by the Commercial Tax Officer that from the account books produced by the assessees it will not be possible to find out whether any particular quantity of aluminium scarp supplied by a particular customer was ear-marked and kept apart, converted into circles and supplied back to the customers. The assessing authorities have also found that there have been instances, as disclosed by the accounts of the assessees, where the scrap was supplied by the customers long after they received the aluminium circles from the assessees. The business of the assessees in regard to the supply....

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....ness. In South India Metal Works and Rolling Mills v. State of Madras[1960] 11 S.T.C. 507. , the assessee collected scrap metal from his customers, melted the scrap, manufactured sheets and rings and gave back to the customers the new sheets and rings. The identity of the new sheets and rings could not be correlated to and established with the scrap supplied by the customer. The Sales Tax Authorities assessed the assessee to tax estimating the turnover of the transaction at three times the labour charges. The Division Bench held that there was no purchase of the scrap by the assessee and there was therefore no element of sale when the sheets and rings were handed over to the customer and that what was collected from the customer was in s....