TaxTMI 
TaxTMI 
TaxTMI 
2009 (7) TMI 1159
X X X X Extracts X X X X
X X X X Extracts X X X X
.... single user, was disallowed and the claim for concessional rate of tax in respect of interState sales against "C" forms was also rejected. The appeal filed by the first respondent was dismissed by the Appellate Assistant Commissioner by an order dated January 11, 2001. Therefore, the first respondent-assessee filed a Second Appeal in MTA No. 469 of 2001 on the file of the Additional Bench of the Tamil Nadu Sales Tax Appellate Tribunal. The Tribunal allowed the appeal by an order dated July 31, 2001, holding that the printed materials supplied by the assessee to their customers constituted a works contract and not outright inter-State sales. The State filed a writ petition in W.P. (MD) No. 3770 of 2004 against the order of the Tribunal, but the same was rejected by the learned single judge by an order dated June 8, 2007 See page 203 supra.. It is against the said order that the State is on appeal. It is seen from the assessment order dated August 31, 1999, that the assessing officer accepted the claim of the dealer that they printed and supplied labels as per the specifications, designs and general layout of the customers with their names and addresses prominently printed. Howev....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... there is no necessity for us, to undertake a long and weary journey into the question of law, especially in view of the very findings of fact recorded by the assessing officer. The findings of fact recorded by the assessing officer, are as follows: "It was true that the dealers have printed and supplied labels as per specifications, designs and general layout of the customers with their names and addresses prominently printed. But they have been printed on the own paper of the dealers, (i.e.,) printers. The customers have not supplied the papers. Even though they have been printed on specifications of customers, they have commercial value in open market. Because, the labels printed announce to the customers that the product is or is not of his choice and his purchase of the commodity would be decided by the printed matter on the 'labels'. The printing of the labels is not incidental to its use but primary in the sense that it communicates to the customer about the product and this serves a definite purpose. But for printing, the labels would serve no purpose and it is the printing on page of paper which communicates the message to the buyer that makes the paper a 'la....
X X X X Extracts X X X X
X X X X Extracts X X X X
....who manufacture spurious goods under the very same brand name, had an opportunity to buy these labels, so as to pass off their goods as that of the customers of the first respondent-dealer. Therefore even on factual findings, the orders of the assessing officer and the appellate authority, cannot be sustained. Hence the Tribunal and the learned judge, were perfectly right in their approach. But de hors the above, we shall also deal with the decisions of the apex court relied upon by the learned Government Advocate. The decision of the Supreme Court in Chandra Bhan Gosani case [1963] 14 STC 766, arose out of the assessment of bricks manufactured and supplied by the assessee to a particular company. The Supreme Court held that there was a sale, in view of the fact that there was a transfer of property in the earth to the appellant by the company and that there was also a transfer of property in the bricks for a consideration. This decision may not be of any assistance to the State, since what was sold (in that case), namely, the bricks, by themselves, constituted a product manufactured and sold. On the contrary, labels are not products by themselves, but are intended to be used on ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r work in the execution of which goods are used may take any one of the three forms as mentioned by this court in Government of Andhra Pradesh v. Guntur Tobaccos Ltd. [1965] 16 STC 240 (SC)." The decision in Rollatainers Ltd. [1994] 95 STC 556 (SC) arose out of the Central Excise Act, where the products of the printing industry were exempt. The Supreme Court held that a printed carton is the product of the packaging industry and not the product of the printing industry. Therefore that decision is of no avail to the appellant. A.P. State Electricity Board [1994] 95 STC 595 (SC), is also a case which arose under the Central Excise Act and the Supreme Court held therein that what is important is to find out if the goods are marketable or not, irrespective of whether they are, in fact, marketed or not. One cannot apply that analogy to the labels printed by the first respondent for a particular customer. To say that the labels printed and supplied by the assessee to a particular customer are saleable in the open market, is equivalent to saying that there are spurious goods available in the market under the very same brand name and that those indulging in the sale of spurious goods are....