Page 175 - GSTL_2nd April 2020_Vol 35_Part 1

2020 ] RAJESWARI COLOUR LAB v. COMMISSIONER OF COMMERCIAL TAXES, CHENNAI 77
photograph, develop the negative, or do other photographic work and
thereafter supply the prints to his client, he cannot be said to enter into a
contract for sale of goods. The contract on the contrary is for use of skill and
labour by the photographer to bring about a desired result. The occupation
of a photo-grapher, 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 re-
veals not only the aesthetic sense and artistic faculty of the photographer, 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 actu-
al life, 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 they years
roll by leave what is preserved in the photograph unaffected. It is no won-
der that an old photograph revives nostalgic memories of days no more,
but to which we rook back through the mist of time with fondness even
though such fondness has a tinge of sadness.
13. In a subsequent judgment, the Supreme Court in the case of Rain-
bow Colour Lab (supra) reiterated the position that the work of a photographer
was only in the nature of ‘service contract’ that did not involve sales of goods.
14. This view was yet again reiterated in the case of Associated Cement
Companies Ltd. (supra) by the Full Bench and thereafter by the Division Bench of
the Supreme Court in C.K. Jidheesh (supra).
15. In a recent decision in the case of M/s. Imagic Creative Private Ltd.
(supra) a Bench of the Supreme Court considered the question of whether charg-
es collected towards service rendered by an advertising agency for evolving of a
prototype conceptual design upon which service tax had been collected would
also be liable for tax under the Karnataka Value Added Tax Act, 2003.
16. After considering the nature of services rendered, the Bench con-
cluded that payment of service tax and Value Added Tax are mutually exclusive.
Therefore, they should be held to be applicable exclusively having regard to the
relevant parameters of the respective levies and bearing in mind the differences
envisaged in a composite contract as contradistinguished from an indivisible
contract. The former may consist of different elements each providing for, and
attracting different levies.
17. The resounding position of law as on date is thus to the effect that
the activity of digital photography as carried on by the petitioner herein, is a ser-
vice as contemplated under the provisions of the Finance Act, 1994 levying ser-
vice tax and the petitioner is, already, remitting service tax on the said receipts.
In such circumstances, there is no justification to subject the receipts to Value
Added Tax both on the reasoning that :-
(i) the activity in question is a contract for skill and labour and
(ii) the levy of Service Tax and Value Added Tax are mutually exclu-
sive.
18. In the light of the aforesaid, the impugned assessments are quashed
and these writ petitions are allowed. No costs. Consequently, connected miscel-
laneous petitions are closed.

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GST LAW TIMES  2nd April 2020  239