1963 (5) TMI 47

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....ed his return in Form A for the year ended 31st March, 1959, showing a gross and net turnover of Rs. 4,922-81 and Rs. 4,842-08 respectively. The Deputy Commercial Tax Officer determined his net turnover for the year to the best of his judgment at Rs. 2,10,979-59, the total receipts disclosed by the books, and subjected it to tax at the rate of 1 per cent. The assessee preferred an appeal to the Appellate Assistant Commissioner of Commercial Taxes. That officer after giving relief in respect of some items determined the turnover at Rs. 77,685.08 representing the receipts for sale of hosiery goods and value of cloth and tailoring charges. Against this order a further appeal was filed by the assessee to the Sales Tax Appellate Tribunal, ....

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....rately in advance cannot alter the nature of the contract which is for the supply of garments. We cannot agree with this observation because the moment the customer selects the cloth from the piece-goods department, settles the price and pays an advance and the cloth so selected is cut and set apart for his use, it becomes his property and is appropriated by him, and the assessee thereafter only supplies work and labour for making the cloth into garments. It is immaterial whether the cloth so selected by the customer is cut in his presence or subsequently and then sent to the tailoring department by the assessee for the purpose of stitching. Thus the transaction consists of two parts, one the sale of cloth by the assessee to his customers a....

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....bour. (4) In the fourth and last group, the customer goes to the shop and selects certain material and this is made up by the tailoring department. In this case, the mere fact that certain material has been selected is not enough to transfer the property. The property is transferred when the material is made up as a completed garment and delivered to the customer." Applying the above tests, it will be clear that the instance case will come under group (2). It is immaterial whether the customer purchases materials to be made into garments from the assessee's shop itself or brings his own goods for the purpose of stitching. The assessee in the present case has got two departments, piece-goods department and tailoring department. The cus....