1962 (8) TMI 64

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....e and means a contract as defined in the Indian Contract Act or is limited and means only a contract as defined under subsection (c) of section 2 of the said Act?" The circumstances giving rise to the references are these. Wah Stone and Lime Quarry Company, Pathankot, and Pathankot Bajri and Stone Company, Pathankot, held contracts for the supply of ballast, bajri and stone to the Public Works Department of the Punjab Government and both these companies claimed exemptions from sales tax. The assessing authority having disallowed their claims on 29th of June, 1951, appeals were taken to the Deputy Excise and Taxation Commissioner, who rejected these on 11th of November, 1951. The first applicant (Wah Stone and Lime Quarry Company) was ass....

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....r vehicle." According to the assessing authorities the material supplied by the claimants to the Government being used for the repair of buildings, the proviso to section 4 which granted exemption on sales in the execution of a contract entered into prior to the commencement of the Act could not be made applicable to them. In other words, a contract referred in the proviso is separate and distinct from a contract as defined in clause (c) of section 2 of the Act. The claimants having failed also before the Excise and Taxation Commissioner asked the Financial Commissioner to make a reference to the High Court but the then Financial Commissioner, Mr. Kaul, declined to do so. This Court was then moved under section 22 of the Punjab General Sale....

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....nt of India Act." It is argued by Mr. Sarin, counsel for the applicants, that the special notion of a contract introduced by section 2(c) of the Punjab General Sales Tax Act is unwarrantable and has been rejected by their Lordships of the Supreme Court in the two authorities mentioned above. Even the Legislature has accepted this position by repealing clause (c) of section 2 altogether. In his submission, the sales tax must in the result be levied in accordance with the substantive provisions of section 4 and the "contract" referred to in the proviso can have reference only to the contract as defined in the Indian Contract Act. We are not called upon to give an answer on the merits of this argument. We have merely to say which of the two....