TMI Blog1995 (3) TMI 438X X X X Extracts X X X X X X X X Extracts X X X X ..... eal, the Tribunal relying upon the decision of this Court in Natarajan and Sons v. State of Tamil Nadu [1977] 39 STC 443 held that when the content is not taxable, the container is also not taxable. Accordingly, the enhancement petition filed by the department was dismissed. As against this order, the State is in revision before this Court. 2.. The learned Additional Government Pleader (Taxes) submitted that there is no evidence on the side of the assessee to show that the sale value of the bran would include the sale value of the gunny bags also. No agreement was produced to show that the assessee is compelled to sell the bran along with the gunny bags. It was further pointed out that as per the definition of sale price contained in section 2(h) of the Central Sales Tax Act, when the assessee sold the bran packed in gunny bags, it would be deemed that the bran and the gunny bags were separately sold. Therefore, the sale value or turnover of the bran as well as the packing material, namely, the gunny bags are taxable under the Central Sales Tax Act. In order to support the abovesaid contention, the learned Additional Government Pleader (Taxes) relied upon various decisions abou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... value of the bran includes the sale value of the gunny bags and therefore a separate tax need not be levied on the sale value of the gunny bags. This was not a case put forward by the assessee herein. 6.. In similar circumstances, in A.R. Manickam Chettiar Sons v. State of Tamil Nadu [1992] 87 STC 134; (1992) 2 MTCR 6 this Court held that the question as to whether there is an agreement to sell packing material is a pure question of fact depending upon the circumstances of each case. Whether packing material was subject to any agreement, expressed or implied, needs to be determined and would depend upon the nature of the transaction. In that case, this Court has held that what was sold was not merely rice or paddy, but the same along with the packing material, that is, gunny bags. Therefore, the assessing authority was correct in levying tax on the sale turnover of gunny bags. 7.. Similarly, in the decision in A. Prakasam Pillai and Sons v. State of Tamil Nadu [1993] 91 STC 95; (1992) 2 MTCR 117 the facts arising are that the jaggery was sold by the assessee packed in gunny bags. The assessee submitted that the sale value of the gunny bags is not taxable. While deciding the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ising in that case, by a notification issued by the Andhra Pradesh State Government, sales or purchases of tobacco and all its products were exempted from sales tax. The department sought to assess the assessee, a manufacturer of and dealer in cigarettes, on the turnover in respect of packing materials consisting of cardboard and dealwood. The assessee contended that the packing materials are not taxable. While deciding this issue, the Supreme Court held that 'in order to constitute a sale it is necessary that there should be an agreement between the parties for the purpose of transferring title to goods, that it should be supported by money consideration and that as a result of the transaction property should actually pass in the goods. Unless all these elements are present there could be no sale. What the sales tax authorities had to do was to ask and answer the question whether the parties, having regard to the circumstances of the case, intended to sell or buy the packing materials or whether the subject-matter of the contracts of sale was only cigarettes, and packing materials did not form part of the bargain at all, but were used by the sellers as a convenient and cheap vehic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eer was sold in bottles packed in cartons and cement was sold in gunnies. While considering the provisions of sections 2(s), 5(2), 6-C, Schedule I, entries 18, 19, 67, 123 and 157 of the Andhra Pradesh General Sales Tax Act, 1957 and Schedule VI, entry 1 of the Andhra Pradesh General Sales Tax (Amendment) Act, 1984 and section 3 of the Andhra Pradesh General Sales Tax Rules, 1957, the Supreme Court held as under: "It is, therefore, perfectly plain that the issue as to whether the packing material has been sold or merely transferred without consideration depends on the contract between the parties. The fact that the packing material is of insignificant value in relation to the value of the contents may imply that there was no intention to sell the packing material. In a case where the packing material is an independent commodity and the packing material as well as the contents are sold independently, the packing material is liable to tax on its own footing. Whether a transaction for sale of packing material is an independent transaction will depend upon several factors, some of them being: (1) the packing material is a commodity having its own identity and is separately classified ..... X X X X Extracts X X X X X X X X Extracts X X X X
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