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Issues:
Whether the appellant was engaged only in works contracts and not in sales of spare parts? Analysis: The appeals were filed by Tvl. Guindy Automotive Corporation against the orders of the Appellate Assistant Commissioner for the assessment years 1971-72 and 1972-73. The assessing officer determined the taxable turnover of the appellant, focusing on repairs and improvements to automobiles. The appellant contended that there were no sales of spare parts, only contracts for work and labor. The appellant would purchase spare parts on behalf of customers for repairs, and various Government Departments had specific instructions regarding the handling of bills and vouchers. The Department resisted the appeals, leading to the central issue of whether the appellant was solely involved in works contracts and not spare parts sales. The Assistant Commercial Tax Officer described the appellant as a motor mechanic specializing in automobile repairs, not spare parts sales. The officer acknowledged the appellant's role in major repair works and the practice of purchasing spare parts locally for customers. The Appellate Assistant Commissioner verified accounts and bills, noting instructions from Government Departments regarding genuine spare parts and supporting bills. The Commissioner observed that the appellant purchased and sold goods to customers while undertaking repairs, emphasizing the need to preserve bills to determine first or second sales. However, the appellant was obligated to hand over original bills to customers, making it unfair to expect bill preservation. The Commissioner concluded that there was no sale of spare parts by the appellant, given the nature of the appellant's work as a mechanic. Referring to a Division Bench judgment of the Allahabad High Court, it was highlighted that contracts involving labor and skill, along with the supply of goods, should be categorized based on the predominant intention of the parties. If the primary element is the performance of work, it is a contract of work exempt from assessment; if it is a sale, it is assessable. The assessing officer and the Appellate Assistant Commissioner's observations indicated that the appellant undertook contracts of work, not sales. There was no evidence of spare parts sales during the relevant years, further supported by local purchases. Consequently, the Tribunal found merit in the appellant's representations and ruled in favor of the appellant, allowing both appeals and setting aside the orders of the Appellate Assistant Commissioner and the assessing officer for the respective years.
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