Page 174 - GSTL_2nd April 2020_Vol 35_Part 1

76 GST LAW TIMES [ Vol. 35
5. The petitioner challenged the same by way of writ petitions in W.P.
(MD) Nos. 1361 to 1363 of 2012. A Learned Single Judge of this Court, vide order
dated 21-8-2012, allowed the writ petitions on the simple ground of violation of
the principles of natural justice. The Learned Single Judge directed the respond-
ent to consider the objections of the petitioner and pass orders de novo and in ac-
cordance with law. Pursuant thereto, the petitioner filed objections dated 24-9-
2012 objecting to the proposed levy on the Act on the ground that its activities
tantamount to ‘service’ and ‘not sale of goods’.
6. The petitioner inter alia relied upon the judgments of the Supreme
Court as follows :
(i) The Assistant Sales Tax Officer and Others v. B.C. Kiame [(1977) 39 STC
237]
(ii) M/s. Associated Cement Companies Ltd. v. Commissioner of Customs
[124 STC 59 = 2001 (128) E.L.T. 21 (S.C.)]
(iii) M/s. Imagic Creative Private Limited v. Commissioner of Commercial
Taxes and Others [2008-12 VST 371 = 2008 (9) S.T.R. 337 (S.C.)].
(iv) Rainbow Colour Lab v. State of Madhya Pradesh [2001 (134) E.L.T.
332 (S.C.)]
(v) C.K. Jidheesh v. Union of India [3 VST 1 = 2006 (1) S.T.R. 3 (S.C.)]
7. Notwithstanding the detailed submissions made and the objections
raised, the impugned orders of assessment have been passed by the Assessing
Officer as against which the present writ petitions have been filed.
8. Heard Mr. Baktha Siromoni, Learned Counsel for the petitioner and
Mrs. J. Padmavathy Devi, Learned Special Government Pleader appearing on
behalf of the respondents.
9. The issue before me concerns taxability of turnover received from the
services rendered by the petitioner in regard to digital photography. Courts have
consistently settled the position that the activity carried in this regard would on-
ly amount to a ‘contract of skill and labour’ and not a ‘contract of sale’.
10. The first judgment on this issue is that of the Full Bench of the Su-
preme Court in the case of B.C. Kiame (supra) wherein the Bench, after extracting
a paragraph from “Sale of Goods” by P.S. Atiyah noticing that the distinction
between a ‘contract of sale’ and ‘contract of skill and labour’ agitated the Courts
frequently states thus :
11. In the case of Robinson v. Graves, it was held that a contract to
paint a portrait was a contract for skill and labour and not a contract for the
sale of goods despite the position that the object of the contract to transfer
the property in the completed portrait to the defendant. The exercise of skill
and labour, consequence to the substance of the contract, was only ancillary
to the position that the some tangible materials in addition to the skill was
transferred to the customer and this did not make a difference to the result.
Because the substance of the contract was in effect exercise of skill and ex-
perience of the artist in producing the picture.
1 12. Though the above observations were made in the context of the ac-
tivities/skill of a photographer, the Full Bench concluded as follows :
Keeping the above principles in view, we may now turn to the facts of the
present case. When a photographer like the respondent undertakes to take
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1 Paragraph number as per official text.
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