TaxTMI 
TaxTMI 
1962 (11) TMI 30
X X X X Extracts X X X X
X X X X Extracts X X X X
....als were not, however, used up in the drawings for the year and a large surplus was left with him at the end of the year. The Deputy Commercial Tax Officer assessed him to sales tax on a turnover of Rs. 14,916-12. On appeal to the Appellate Assistant Commissioner the assessment was set aside. He held that the appellant was not "a dealer" and that his transactions were not sales within the meaning of the Madras General Sales Tax Act, 1939. The Board of Revenue, acting in exercise of its revisional power, set aside the order of the Appellate Assistant Commissioner after due notice to the appellant. The Board restored the assessment of the Deputy Commercial Tax Officer. In the view of the Board the appellant sold the pictures for a price and t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ment, that the appellant is a dealer apart from, what may be called, the picture transactions. The primary question, therefore, in this case would be whether these transactions constitute sales within the meaning of the Act. If they are not sales the turnover of these transactions cannot be taxed. If they are sales the appellant must be held to be a dealer, as he, indisputably, carried on such transactions in the course of his occupation or career. We shall therefore proceed to consider the real nature of the activities of the appellant with reference to the pictures drawn by him. "Sale" is defined under the Act as follows: "Sale with all its grammatical variations and cognate expressions means every transfer of the property in goods by ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hed from contract for work and labour: A contract of sale of goods must be distinguished from a contract for work and labour. The distinction is often a fine one. A contract of sale is a contract whose main object is the transfer of the property in, and the delivery of the possession of, a chattel as a chattel to the buyer. Where the main object of work undertaken by the payee of the price is not the transfer of a chattel qua chattel, the contract is one for work and labour." In Clay v. Yates25 L.J. Ex. 237; 1 H. and N. 73.', the contract was that the plaintiff, a printer, should print for the defendant a second edition of his book, the plaintiff to find the materials including the paper. It was held that this was not a contract for the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....repudiated the contract and on the artist suing him for its breach pleaded section 4 of the Sale of Goods Act, 1893. It was held that the plaintiff was entitled to succeed because as the contract in substance was for the exercise of skill, and as materials would have passed from the plaintiff to the defendant only as incidental to that skill the contract was not a contract for the sale of goods but one for work and labour and materials supplied, and therefore section 4 did not apply. The basis of the decision is to be found in the following words of Greer, L.J., at page 939: "If you find, as the Court did in Lee v. Griffin1 B. and S. 278., that the substance of the contract was a contract to produce something to be sold by the dentist to....