(1.) THESE tax revision cases arise out of the order of the Sales Tax Appellate Tribunal, Main Bench, Madras-1, dated 11th March, 11th March, 1971, in respect of two assessment years 1966-67 and 1968-69, and the controversy is very narrow. The assessee in these cases entered into contracts with the Universities and the other educational institutions in the country for printing question papers for the said educational institutions. The assessee in the demand notes prepared gave the charges for printing, blocks, packing charges, handing charges, delivery charges, postage, value of paper and value of packing materials separately in the relevant assessment years. The dispute related as to whether the taxable turnover should include the printing charges and block-making charges or not. As far as the assessment year 1966-67 is concerned, the printing charges amounted to Rs. 99, 675.00 and block-making charges amounted to Rs. 2, 923.95 totalling Rs. 1, 02, 598.95. As far as the assessment year 1968-69 is concerned, the printing charges amounted to Rs. 1, 33, 137.00 and block-making charges amounted to Rs. 5, 361.75 totalling Rs. 1, 38, 498.75.
(2.) THE question to be considered is whether these two amounts were includible in the assessable turnover in the respective years in question. THE case of the respondent was that the contract entered into between her and the respective educational institutions was a contract of work and labour and in the performance of that contract, incidentally she had to sell paper to them and, therefore, except to the extent of the cost of paper, in respect of the other amounts received by her she was not liable to pay any sales tax. On the other hand, the case of the Government was that the contract was for the sale of printed materials by the respondent to the respective educational institutions and, therefore, the entire amount will have to be taken into account as turnover liable to tax. We may point out in this context that till the year 1963 the respondent herself was doing the printing and during that period the Tribunal has been holding that only the cost of the paper was liable to be included in the taxable turnover. With effect from 3rd November, 1963, the printing work was done by a firm of which the assessee's sons and daughters were partners, but the contract continued to be entered into between the respondent and the respective educational institutions.
(3.) IT is not in dispute that the printing of the question papers of the educational institutions is extremely and highly of a confidential nature and, therefore, it cannot be entrusted to any press as one likes, and such a contract will be entered into by the Universities and the other educational institutions only with a person in whom they have got the highest confidence so that the printer will not divulge the questions to be printed by her or by him and will preserve the confidential nature of the entire transaction. In the case of the printing of the other materials, just like letter-heads or bills or account books or even printing works like a novel, story or poem or a drama, the technical excellence and the professional efficiency of the printer, among other things, may enter into calculation for entrusting the job to a particular printer. But, as far as the printing of question papers of Universities and other educational institutions is concerned, matters like the technical excellence and the professional efficiency of the printer are not so material, but what motivates the contract is the capacity of the printer to keep the confidence and maintain the confidential nature of the work entrusted to the printer. Consequently, in view of this peculiar feature which will be present in the printing of matters which are confidential in nature and which will not be present in other cases, the contract in the present cases without doing any violence to logic or reasoning, can be held as a contract of labour only, and not a contract for the sale of any goods such as printed materials.