B C KAME Vs. ASSISTANT SALES TAX OFFICER

JUDGEMENT

(1.) THIS is a writ petition by Shri B. C. Kame who is the proprietor of Kame Photo Studio. He has two more branches--New Delhi Studio and P. Kame Studio, all in the city of Jabalpur. He carries on the business of buying and selling photographic goods. In the certificate of registration as dealer under the Madhya Pradesh General Sales Tax Act it is entered that he also uses the photographic goods as raw material for manufacture of other goods for sale. When he buys the goods outside the State of Madhya Pradesh he gives a declaration that he will either resell the goods or use them as raw material for manufacture of other goods for sale. He thus gets a concession in respect of sales tax under the Central Sales Tax Act on his purchases. After getting those goods he either sells them to his customers here or uses them in three ways-- (1) by taking photographs and supplying prints thereof, (2) by making enlargements for customers who bring their own negatives, and (3) by simply preparing positive prints of the same size from the negatives brought by the customers. For doing all these kinds of works he charges a consolidated amount differing according to the work involved and the size and number of prints demanded by the customer.

(2.) THE Madhya Pradesh Sales Tax Department has assessed the petitioner for the different periods from 1st April, 1964, to 31st March, 1969, to sales tax on his turnover on best judgment basis as he did not keep full and complete accounts. The figures of assessment of one of such periods are reproduced to indicate the basis of assessment which has been followed in each period. There being no difference in the principle involved, it is not necessary to give the details of other periods. For the first period, i. e. , 1st April, 1964, to 31st March, 1965, the assessment was made by order dated 30th April, 1970. The total turnover was taken to be Rs. 41,500. Out of this a deduction of Rs. 6,500 was allowed as relatable to developing and enlargement which was not considered chargeable. The balance of Rs. 35,000 was again divided into two parts--Rs. 12,000 being treated as relatable to sale of materials as such and charged at 10 per cent. and the rest Rs. 23,000 being taken to be the receipts on account of the supply of photoprints to those who got themselves photographed at the studios.

(3.) IN the present writ petition the challenge is only to the last item similarly charged for all the periods on the gross receipts for the supply of photo prints, treating them to be manufactured finished products sold to the customers. The contention of the petitioner is that in taking a photograph, preparing its negative and then preparing the final positive print for supplying the same to the customer, the petitioner undertakes a contract of work and labour and does not enter into a sale transaction. The customer does not come to the studio to buy the printed paper but to utilise the skill of the photographer to get a good photo prepared. The petitioner has also contended that the prepared positive print is not a marketable commodity and he cannot sell the photo of one person to any other person except with the former's consent. His claim, therefore, is that this item for each period-has been wrongly taxed.