1970 (9) TMI 96 - HC - VAT and Sales Tax

Summary

Issues:
1. Whether supplies of bricks against permits constitute sales liable to sales tax.

Analysis:
The judgment pertains to Letters Patent Appeals filed against a Single Judge's decision allowing writ petitions challenging assessment orders on the grounds that supplies of bricks against permits were not sales liable to sales tax. The Single Judge relied on a Supreme Court decision regarding mutual assent in transactions. However, the High Court found the facts in the present case materially different. The Control Order under consideration regulated the supply of bricks but did not control every aspect, allowing room for consensus between parties. The High Court cited a similar Supreme Court case involving a Control Order for steel products to support its interpretation. The court emphasized that mutual assent was present in the brick supply transactions, satisfying the elements of a valid sale.

The court analyzed the Control Order provisions, highlighting that while certain aspects were regulated, parties could agree on terms such as delivery date, payment mode, and transport arrangements. Drawing parallels with the steel products case, the court concluded that the Controller's directions did not eliminate mutual assent in the transactions. Referring to the Supreme Court's criteria for a valid sale, the court confirmed the presence of competent parties, transferred property, and price in the brick supply transactions. Emphasizing the importance of mutual assent, the court distinguished the facts from a previous Supreme Court case where mutual assent was absent, thereby classifying the transactions as sales.

In conclusion, the High Court allowed the appeals, overturning the Single Judge's decision and dismissing the writ petitions. The court aligned with the Supreme Court's interpretation in similar cases, affirming that the transactions involving brick supplies against permits constituted sales liable to sales tax. No costs were awarded in the circumstances of the case.