STATE OF MYSORE Vs. S R BHIDE

JUDGEMENT

(1.) The respondent Bhide entered into a contract with the Southern Railway under which he agreed to collect and train out stone ballasts in certain zone of that railway administration comprising the Ranibennur, Yalavagi and Annigere and Hubli permanent way sections. When he collected the ballasts and trained them out on the permanent way sections he was paid a sum of Rs. 1,64,995 by the railway administration. This sum of money was assessed to sales tax by the Commercial Tax Officer on the hypothesis that there was a sale by the respondent to the railway administration of stone ballasts of the value of Rs. 1,62,470, and other materials in respect of another contract of the value of Rs. 2,525. There were two contracts which were entered into between the respondent and the railway administration. The one related to the construction of buildings and other connected works, and the other to the collection and training out of stone ballasts. The aggregate sum of money paid by the railway administration to the respondent was Rs. 3,45,914. From this sum of money a sum of Rs. 1,53,147 which represented the amount paid to the respondent for the building construction and a sum Of Rs. 27,772 for the training out operations, amounting in the aggregate to a sum of Rs. 1,80,919 was deducted, and the balance amounting to Rs. 1,64,995 was the sum deduced as the price paid for the materials supplied.

(2.) From this order of assessment the respondent appealed unsuccessfully to the Deputy Commissioner, but his further appeal to the Sales Tax Appellate Tribunal succeeded. The Tribunal took the view that it was impermissible for the Commercial Tax Officer to make a bifurcation of the contract by separating from an individual contract that part of it, which in the opinion of the Commercial Tax Officer could be identified as a contract relating to a sale. In the opinion of the Sales Tax Appellate Tribunal no part of the amount received by the respondent could be regarded as a taxable turnover, and so, the order of assessment made in that regard by the Commercial Tax Officer was set aside.

(3.) In this revision petition presented by the State Government against the order made by the Appellate Tribunal Mr. Shantaraju contends that the Sales Tax Appellate Tribunal overlooked the obvious fact that there was a sale of stone ballasts by the respondent to the railway administration.