TMI Blog2005 (10) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... mple. It is held that in such contracts there is no element of sale of goods. This Judgment is binding on this Court. In view of this Judgment, the question of directing the Respondent to bifurcate the receipts into an element of goods and the element of service cannot and does not arise. We see no substance in the contention that facts in Rainbow Colour Labs case were different inasmuch as in that case the Court was dealing with a case where photographers take photographs, develop them and then give the photos to the customer. In our view, the ratio of Rainbow Colour Lab's case also applies to cases like the present. - Writ Petition (C) No. 507 of 2002 - - - Dated:- 27-10-2005 - S. N. VARIAVA., P. P. NAOLEKAR, JJ. Krishnan Venugopa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kerala Colour Labs Association had filed a Writ Petition in the Kerala High Court challenging the constitutional validity of the provisions in the Finance Act, which permits levy of service tax on services like those rendered by the Petitioner. He submits that that Writ Petition came to be dismissed by a Judgment of the Kerala High Court dated 31st January, 2002. He points out that against that Judgment two SLPs were filed. SLP (C) No. 11614 of 2002 was dismissed on 10th July, 2002. He points out that the second SLP bearing CC No. 6811 of 2002 filed by the Kerala Colour Labs Association was also dismissed on 8th January, 2003. He points out that in the synopsis attached to this Petition it is stated that the issues covered in this Writ Peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is for that reason that Rule was issued on 17th January, 2003 and there was an Order tagging it with SLP (CC) No. 4253 of 2002 (which is the SLP filed by the State of Meghalaya). We have looked at the papers of the SLP filed by the State of Meghalaya. We find this Petition has nothing to do with that SLP. It is for that reason that this Writ Petition was delinked from the SLP filed by the State of Meghalaya by an Order dated 7th July, 2004. We find substance in the contention that the Writ Petition should have been dismissed with the dismissal of the SLP filed by Kerala Colour Labs Association. However, as another Court has already issued rule, judicial discipline requires that the matter be now heard on merits. 6. As has been mentione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed as follows : 4.The value of taxable service [in photography service] is the gross amount charged from the customer for the service rendered. However, the cost of unexposed photography films sold to the customer is excluded. ....... No other cost (such as photographic paper, chemicals, etc.) is excluded from the taxable value. 9. Thus, a mere challenge to such a clarificatory letter is not enough. The challenge has to be to the provisions of the Finance Act. 10. The provisions of the Finance Act had been challenged by the Kerala Colour Labs Association. That challenge had been repelled by the Kerala High Court and an SLP against that Judgment has already been dismissed by this Court. We have read the Judgment of the Kerala Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he aforesaid conclusion the Court referred to the decision of this Court in Hindustan Aeronautics Ltd . v. State of Karnataka [(1984) 1 SCC 706 : 1984 SCC (Tax) 90] and Everest Copiers [(1996) 5 SCC 390]. But both these cases related to the pre-Forty-sixth Amendment era where in works contract the State had no jurisdiction to bifurcate the contract and impose sales tax on the transfer of property in goods involved in the execution of a works contract. The Forty-sixth Amendment was made precisely with a view to empower the State to bifurcate the contract and to levy sales tax on the value of the material involved in the execution of the works contract, notwithstanding that the value may represent a small percentage of the amount paid fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Colour Lab's case nor Kerala Colour Lab's case considered the question of discrimination which has been raised by the Petitioner in this Writ Petition. He submits that the Petitioner has also challenged the discriminatory attitude of the Respondent in levying service tax on gross receipts in photographic business when on other pure service providers like stock brokers, travel agent etc. the tax is levied only on the commission. In our view, there is no discrimination. It has already been held by this Court that such cases are contracts of service pure and simple. In other cases, referred to, there is a bifurcation because service is provided and goods are sold. 15. We thus see no substance in this Writ Petition. The same stan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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