TMI Blog1996 (7) TMI 482X X X X Extracts X X X X X X X X Extracts X X X X ..... - BHARUCHA S.P. AND THOMAS K.T. JJ. Indu Malhotra, Advocate, for the appellant in both the appeals. V. Krishnamoorthy, Advocate, for the respondent in both the appeals. -------------------------------------------------- ORDER The appellant runs a photocopying business. It has been assessed to sales tax for the assessment year 1978-79 (in Civil Appeal No. 5339 of 1992) and the assessment year 1979-80 (in Civil Appeal No. 2672 of 1992) on the basis that there was a sale by it of the photocopied or xeroxed document to the customer. The question that we are concerned with, therefore, is whether the making of photostat copies with the use of a xerox or other machine and delivering the copies so taken to the custom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice rendered in addition to the cost of the material used. On these facts, it had to be found what the primary object of the transaction was and the intention of the parties, namely, whether it was a contract purely of work or service or a contract of sale. The High Court noticed the decision of this Court in Hindustan Aeronautics Ltd. v. State of Karnataka [1984] 55 STC 314; [1984] 2 SCR 248, wherein it was held: ".............Mere passing of property in an article or commodity during the course of performance of the transaction in question does not render the transaction to be transaction of sale. Even in a contract purely of work or service, it is possible that articles may have to be used by the person executing the work, and prope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther the contract was in substance one for work and labour and one for the sale of a chattel." The High Court, therefore, held that what was involved was not a contract of sale, but a contract of work or service. The principles enunciated in Hindustan Aeronautics' case [1984] 55 STC 314 (SC); [1984] 2 SCR 248, quoted by the High Court, also find expression in the earlier decision of this Court in Assistant Sales Tax Officer v. B.C. Kame [1977] 39 STC 237; [1977] 2 SCR 435. In Kame's case the respondent carried on the business of supplying photographs to those who got themselves photographed at his studios. It was held that he did not enter into a contract of sale. The judgment of the Karnataka High Court in Girija v. State of Karnatak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he main object of the work undertaken by the operator of the photocopier or xerox machine is not the transfer of the paper upon which the copy is produced; it is to duplicate or make a xerox copy of the document which the payer of the price wants duplicated. The paper upon which the duplication takes place is only incidental to this transaction. The object of the payment of the price is to get the document duplicated, not to receive the paper. The payer of the price has no interest in the bare paper upon which his document is duplicated. He is interested in it only if it bears such duplication. The case is very similar to Kame's case [1977] 39 STC 237 (SC); [1977] 2 SCR 435. The tests laid down by this Court as aforestated are satisfied ..... X X X X Extracts X X X X X X X X Extracts X X X X
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