BANE MADRAS LTD Vs. STATE OF KERALA

JUDGEMENT

(1.) These revision cases arise out of proceedings assessing the petitioner to sales tax under the General Sales Tax Act, 1125 in respect of the years 1958-59, 1960-61 and 1961-62. The petitioners who are dealers in motor vehicles were the authorised dealers of Messrs. Premier Automobiles Ltd., Bombay in respect of Dodge Trucks for Kerala State during the years in question. It is the common case that the petitioners entered into contracts for the supply of motor vehicles fitted with bodies with the Kerala State Electricity Board and some other customers in the State in these years. The main contention of the petitioners which, is common in all these cases is that the contracts with the Kerala State Electricity Board and the other customers were only for the sale of Dodge chassis and bodies were fitted up in the chassis by Messrs. Simpson and Co., Madras and Sree Rama Vilas Motor Service (Private) Ltd., arranged by the petitioners on behalf of the several purchasers at their request. The plea of the petitioners is that the contracts for the construction of bodies on Dodge chassis are not contracts of sale but only contracts of work and the turnover resulting therefrom has to be exempted from taxation and even if such turnover is assessable to tax the petitioners can be assessed only at the rate of 2% and not 7%. All the three appeals giving rise to the revision cases were heard together and disposed of by a common order by the Appellate Tribunal on the ground that the controversy between the parties in all the appeals is identical.

(2.) In view of the decision in Mckenzies Ltd v. State of Maharashtra (1965) 16 STC. 518 the contention that the contracts for building of bodies are only for execution of works was not pressed before the Appellate Tribunal. The Appellate Tribunal observed thus:

(3.) The Appellate Tribunal posed the question for decision in the appeals thus: