RAINBOW COLOUR LAB Vs. STATE OF MADHYA PRADESH

JUDGEMENT

(1.) Common question involved in these appeals are whether the job rendered by a photographer in taking photographs, developing and printing films would amount to a 'works contract' as contemplated under Article 366(2A)(b) of the Constitution read with Section 2(n) of the M.P. General Sales Tax for the purpose of levy of sales tax on business turnover of the photographers.

(2.) Prior to the 46th Constitutional Amendment, this question was settled in favour of the assessees by the judgment of this Court in the case of Assistant Sales Tax Officer v. B.C. Kame, (1977) 39 STC 237 .

(3.) Taking advantage of the 46th Amendment of the Constitution and the consequent amendment to the definition of 'sale' in Section 2(n) of the local Sales Tax Act, the Commissioner of Sales Tax, M.P. issued Circular dated 25-1-1992 opining that the job done by the photographers amounted to "works contract" and turnover from such work would be exigible to the levy of sales-tax. This Circular prompted the concerned Assessing Officer to re-assess the turnover of the assessees and to issue them demand notices.