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TMI Blog1976 (12) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... eral Sales Tax Act (Act 2 of 1959), when the photographer takes photographs or does other photographic work and thereafter supplies the photographic prints to his client or customer is the question which arises for determination in this appeal on certificate against the judgment of the Madhya Pradesh High Court reported in 28 S.T.C. 1 B.C. Kame v. Assistant Sales Tax Officer, Circle No. 2, Jabalpur, and Others. The High Court answered the question in the negative in favour of the assessee- respondent. The respondent is the proprietor of Kame Photo Studio. He has apart from his main shop two branches. He carries on business, inter alia, of buying and selling photographic goods. After buying photographic goods he either sells them to his cus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ositive print for supplying the same to the client, the respondent undertakes a contract of work and labour and does not enter into a sale transaction. It was also stated on behalf of the respondent that the prepared positive print was not a marketable commodity and he could not sell the photograph of one person to any other person except with the former's consent. As against that, the case of the appellants was that the respondent was carrying on a commercial activity in the nature of trade and business and the finished photographs supplied by him to his customer was a commodity and the supply of the same attracted the levy of sales tax. The High Court, on consideration of the matter, came to the conclusion that the respondent only underto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontract is a composite one involving both a contract of work and labour and a contract of sale. Nevertheless, the distinction between the two rests on a clear principle. A contract of sale is one whose main object is the transfer of property in, and the delivery of the possession of, a chattel as a chattal to the buyer. Where the principal object of work undertaken by the payee of the price is not the transfer of a chattel qua chattel, the contract is one of work and labour. The test is whether or not the work and labour bestowed end in anything that can properly become the subject of sale; neither the ownership of materials, nor the value of the skill and labour as compared with the value of the materials, is conclusive, although such ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of sale of foodstuffs. This court accordingly came to the conclusion that there was no sale of foodstuffs and the respondent- company was not liable to pay sales tax in respect of the meals served to the guests in the hotel. In arriving at this conclusion, this court observed as under: "Thus, in considering whether a transaction falls within the purview of sales tax, it becomes necessary at the threshold to determine the nature of the contract involved in such a transaction for the purpose of ascertaining whether it constitutes a contract of sale or a contract of work or service. If it is of the latter kind it obviously would not attract the tax. From the decisions earlier cited, it clearly emerges that such determination depends in each ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en the parties. But if there was no such agreement and the contract was only to construct a building, then the materials used therein would, in the opinion of the Court, become the property of the other party to the contract only on the theory of accretion. The distinction between a contract of sale and a contract for skill and labour has been discussed at page 10 of the 4th Edn. of "Sale of Goods" by P.S. Atiyah. The following passage in that book has a material bearing so far as the present case is concerned: "The distinction between contracts of sale and contracts for skill and labour has agitated the courts for many years, and though its importance has been greatly diminished by the repeal of section 4 of the Act, it still cannot be i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of a photographer, except in so far as he sells the goods purchased by him, in our opinion, is essentially one of skill and labour. A good photograph reveals not only the aesthetic sense and artistic faculty of the photographer, but it also reflects his skill and labour. A good photograph in most cases is indeed a thing of beauty. It not only seeks to mirror and portray a scene from actual life, but it also catches and preserves for the future what belongs to and is a part of the fleeting moment. The ravage brought about by the passage of time, the decay and the ageing process which inevitably set in as the years roll by leave what is preserved in the photograph unaffected. It is no wonder that an old photograph revives nostalgic memories o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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