Somnath Iyer, J.
1. On behalf of the Government of the new State of Mysore, the Stores Purchase committee called for tenders from persons who were willing to construct bus bodies on the chassis supplied by the Government. On the acceptance of the tender submitted by the petitioner before us, which is a firm which engages itself in bus body building and other activities, an agreement was entered not between the Government and the petitioner, under which he agreed to build bus bodies on the chassis supplied by the Government on terms and conditions enumerated in that agreement. This agreement was executed on 23rd January, 1959.
2. When the petitioner produced its return the Sales Tax Act for the assessment year 1960-61, it stated in its return that a sum of Rs. 9,74,460 represented the amounts received by it for the bus bodies constructed under the agreement for the Mysore State Road Transport Corporation which by then laid been established under the Road Transport Corporation Act and which had taken over the undertaking of the Mysore Government Road Transport Department.
3. The Commercial Tax Officer, who reached the conclusion that the monies received by the petitioner represented the price of the bus bodies sold by it to the corporation, included that amount in the taxable turnover, but in the appeal preferred by the petitioner to the Deputy Commissioner of Commercial Taxes, it was able to get an order in its favour. The Deputy Commissioner was of the opinion that the contract entered into by the petitioner and the Government was in the nature of a works contract, and that, under that contract, there was no sale of the bus bodies to the corporation. But in the exercise of his revisional power, the Commissioner of Commercial Taxes under the provisions of section 22-A of the Mysore Sales Tax Act, 1957, set aside the order of the Deputy Commissioner and restored that of the Commercial Tax Officer. He did so for the reason that in his opinion there was a sale of the bus bodies by the petitioner to the corporation. This appeal is directed against that order made by the Commissioner.
4. The agreement which was entered into between the petitioner and the Government in the year 1959 was in a language identical with the language of the previous agreements entered into between them during the previous years, and one such agreement was interpreted by this court in Shankar Vittal Motor Co. Ltd. v. State of Mysore ( 15 S.T.C. 771), in the context of the question whether under the agreement the intention of the parties was that there should be a sale of bus bodies constructed for the Government or whether the contract is merely a works contract. The view taken by this court was that there was no sale, but that the petitioner merely agreed to perform the work of bus body building for the Government. The Deputy Commissioner, who allowed the appeal preferred by the petitioner, depended upon this pronouncement of this court, especially, since it was an authoritative interpretation of an agreement which was worded precisely in the same language in which the agreement which he had to interpret was.
5. But the Commissioner though that the pronouncement of this court could no longer hold the field after the pronouncement of the Supreme Court in Patnaik and Company v. State of Orissa : 2SCR782 and McKenzies Ltd. v. State of Maharashtra ( 16 S.T.C. 518 (S.C.)). He was of the opinion that all transactions reflected in an agreement under which a person agrees to build a bus body on the chassis supplied by another are sales, and that his view to that effect receives support from those two pronouncements of the Supreme Court. He was also of the opinion that the Deputy Commissioner had merely followed the pronouncement of this court in Shankar Vittal Motor's case ( 15 S.T.C. 771), without any independent application of his own mind to the question whether the intention of the parties was that there should be a sale of the bus bodies constructed for the Government.
6. Mr. Swaminathan appearing for the appellant made three submissions in support of this appeal. The first was that the Commissioner of Commercial Taxes could not exercise any revisional jurisdiction under section 22-A. The second was that he proceeded to make his order under the mistake supposition that there was no independent application of the mind of the Deputy Commissioner to the effect and scope of the stipulations in the agreement between the parties. The third was that the agreement in the present case had no resemblance to the agreement which was considered by the Supreme Court in Patnaik's case : 2SCR782 or in Mckenzies' case ( 16 S.T.C. 518 (S.C.)), and that there was greater similitude between the agreement in the present case and that which was discussed by the Supreme Court in State of Gujarat v. Kailash Engineering Co. : 1SCR543 .
7. We do not think that there is any substance in the objection to the jurisdiction exercised by the Commissioner. Although it is true as Mr. Swaminathan submitted to us that the language of the agreement, which was discussed by this court in Shankar Vittal Motor's case ( 15 S.T.C. 771), is identical with the language of the agreement with which we are concerned, it is obvious that if the enunciation made by this court in Shankar Vittal Motor's case ( 15 S.T.C. 771) stands superseded by any enunciation made by the Supreme Court the view expressed in Shankar Vittal Motor's case ( 15 S.T.C. 771) must necessarily be kept aside. Secondly, the agreement which was discussed in Shankar Vittal Motor's case ( 15 S.T.C. 771) was an agreement which was no longer current in the assessment year 1960-61 and the agreement which operated during that assessment year was the agreement executed in the year 1959 which was not the agreement which was discussed by this court in Shankar Vittal Motor's case ( 15 S.T.C. 771). The bar of res judicata upon which Mr. Swaminathan depended did not constitute an impediment to the exercise of the jurisdiction by the Commissioner since what the Commissioner had to investigate was whether the intention of the parties when they entered into the agreement which they executed in the year 1959 was that the petitioner should construct bus bodies for the Government and to sell them as such. The intention with which the previous agreement which was discussed in Shankar Vittal Motor's case ( 15 S.T.C. 771) was executed may or may not be the intention which impelled the execution of the agreement in the year 1959, and so, the plea of res judicata is plainly unavailable to the petitioner.
8. A decision of this court with respect to an agreement on a former occasion can operate as res judicata only when it propounds a general principle applicable to recurring liability arising again and again and no such general principle was the subject-matter of enunciation by this court in Shankar Vittal Motor's case ( 15 S.T.C. 771). All that was expounded in that case was that the intention between the parties, having regard to all circumstances upon which they depended in the context of the agreement which was entered into between them at that point of time, was that the petitioner should only do some work for the Government and not that he should make a sale of the bus bodies to them. We, therefore, repel the argument resting on the plea of res judicata.
9. We do not also think that Mr. Swaminathan is right in making the criticism that the Commissioner was of the opinion that the Deputy Commissioner had not looked into the agreement or discussed it. How we should understand the order made by the Commissioner is that he thought that the Deputy Commissioner had not correctly understood the stipulations in the agreement.
10. So, we now proceed to discuss the only other argument maintained before us that there is no similarity between the stipulations contained in the agreement which was discussed in Patnaik's case : 2SCR782 and Mckenzies' case ( 16 S.T.C. 518 (S.C.)), and those in the agreement with which we are concerned in this case. When we proceed to consider the stipulations in the agreement before us, we observe that the agreement is 'for the construction of the mofussil city type of buses for the Mysore Government'. That was what was stated in clause 2 of the preamble to the agreement. In clause 1 the petitioner was described as a contractor, and it states that the contractor had agreed 'to perform the work' described in the schedule to the agreement. In clause 7 it was stated that if the petitioner did not perform the 'work' satisfactorily, the Government would have the liberty to get the 'work' done by someone else. There was also a reference in that clause to the consequence of 'incomplete workmanship' on the part of the petitioner Clause 9 authorised the General Manager of the Mysore Government Road Transport Department to inspect the work performed by the petitioner whenever he thought it necessary to do so and to issue instructions to the petitioner from time to time. Clause 10 referred to the work to be done by the petitioner as 'the construction of the body', and clause 11 provided for the payment of the amounts specified in 'the bill of costs' tendered by the petitioner against the 'delivery of the complete bus'. Clause 13 provided that the decision of the General Manager of the Department should be final with respect 'to quality of workmanship, etc.'
11. It will thus be observed that throughout the agreement the petitioner who is referred to as the contractor is asked to perform certain work for Government. That work was the work of building bus bodies on the under frames or the chassis supplied by the Government to it. In no part of the agreement was there any stipulation that there should be a sale of the body so constructed by the petitioner to the Government or a stipulation for payment of a price for such sale.
12. It is now clear from the elucidation made by the Supreme Court in Chandra Bhan Gosain v. State of Orissa : 2SCR879 that the question to be investigated by us in a case like the one before us is 'was it the intention of the parties in making the contract that a chattel should be produced and transferred as a chattel for a consideration.' It is equally clear from the enunciation made in Patnaik's case : 2SCR782 that the answer to that question must depend on the construction of the agreement in each case and that an interpretation or construction placed upon an agreement in one case cannot assist the interpretation in another. In Patnaik's case : 2SCR782 , upon which the Commissioner of Commercial Taxes depended, the agreement was between the appellants in that case and the State of Orissa for the construction of bus bodies on the chassis supplied by the Governor. The contention of the appellants that the agreement entered into between them and the Governor was for the performance of certain work and there was no sale of bus bodies, was negatived on the basis of the terms and conditions which the agreement between them set out.
13. Referring to the decision of the High Court of Gujarat in Kailash Engineering Co. v. State of Gujarat ( 15 S.T.C. 574) on which dependence was placed for the appellants, the Supreme Court observed that it would not express any opinion on the correctness of that decision since what has to be examined in each case was the intention of the parties.
14. But when that decision of the Gujarat High Court (Kailash Engineering Co. v. State of Gujarat ( 15 S.T.C. 574)) was appealed against by the State of Gujarat in State of Gujarat v. Kailash Engineering Co. : 1SCR543 , the Supreme Court affirmed the view taken by the High Court of Gujarat pointing out the distinguishing features between the agreement in Patnaik's case : 2SCR782 and that in Gujarat's case : 1SCR543 . The Supreme Court was of the view that the dissimilarity between the two agreements was demonstrated by at least three features of the agreement in Patnaik's case : 2SCR782 . The first, as explained by the Supreme Court, was that while the agreement in Patnaik's case : 2SCR782 referred to the bodies to be constructed in that case as composite bodies distinct from the chassis or the under frames on which they were constructed, the contract in the Gujarat's case : 1SCR543 contained no similar clause. The second feature to which the Supreme Court referred was that the agreement in Patnaik's case : 2SCR782 authorised the Controller to take delivery of the unfinished bodies, only if the work was not to his satisfaction. The third stipulation in the agreement to which the Supreme Court alluded was that in the event of an accident by fire, while there was a provision only for the insurance of the chassis, there was none in respect of the bus bodies, and that the builder himself should bear the loss in that event since it remained the property of the builder until it is delivered to the other party. While it was maintained by Mr. Swaminathan that the agreement in the present case had greater resemblance to the agreement in the Gujarat's case : 1SCR543 , Mr. Shantharaju appearing for the department asserted that there is greater resemblance between the agreement in the present case and that in Patnaik's case : 2SCR782 .
15. We should pronounce on the dissimilarity between the agreement in Patnaik's case : 2SCR782 and that in the present case for at least one of the reasons for which the Supreme Court pronounced against similarity between the agreement in Patnaik's case : 2SCR782 and the Gujarat's case : 1SCR543 . The first feature of the agreement in Patnaik's case : 2SCR782 , which the Supreme Court did not find in the Gujarat's case : 1SCR543 , is also not to be found in the agreement in the present case. Speaking of that feature the Supreme Court said this :
'The first circumstances was that the bus bodies were, throughout the contract, spoken of as a unit or as a composite thing to be put on the chassis, and this composite body consisted not only of things actually fixed on the chassis but movable things like seat cushions, and other things which could be very easily detached. In the contract, with which we are concerned, the coach bodies are not separately described as units or components to be supplied by the respondent to the railway. The language used in the contract everywhere describes the duty of the respondent to be that of constructing, erecting and furnishing coach bodies on the under frames supplied. At no stage does the contract mention that ready coach bodies were to be delivered by the respondent to the railway.'
16. What was said by the Supreme Court with respect to the agreement in the Gujarat's case : 1SCR543 applies, in our opinion, equally to the agreement before us. As in the case of the agreement in the Gujarat's case : 1SCR543 , the contract before us makes no mention in any part of it that the bodies should be delivered by the petitioner to the Government as separate or composite units. On the contrary, it is clear from clause 11 of the agreement that what had to be delivered by the petitioner to the Government was 'the complete bus'. To the question whether the body had to be delivered to the person for whom it was built as a composite unit distinct from the under frame on which it was constructed, the Supreme Court addressed itself, for the reason that was explained by it in Chandra Bhan Gosain v. State of Orissa : 2SCR879 , the question to be examined in a case like the present one is whether the intention of the parties in making the contract was that a chattel should be produced and transferred as a chattel for consideration. So it was that the Supreme Court investigated the question whether the intention of the parties was that a railway coach had to be fitted on the under frame supplied, to be sold to the railway administration as such, for a consideration. If the Supreme Court though that for the reason that the agreement in the Gujarat's case : 1SCR543 did not provide that the production of coaches to be so constructed on the under frames should be sold as such coaches for a consideration to the railway administration, it should reach the conclusion that the intention was not that there should be a sale to the railway administration by the builder, we should say the same thing in the present case in which the agreement does not provide that the bus bodies constructed by the petitioner should be sold as but bodies for a consideration to the Government. If the agreement does not demonstrate that the intention was such, the conclusion reached by the Commissioner that the intention was that there should be a sale stands negatived.
17. We do not accede to the contention of Mr. Shantharaju that there is anything in the agreement before us which establishes any such intention between the parties to it. Clauses 7 and 11 of the agreement on which he depended, far from supporting his contention, negatives it. Clause 7 refers to the work to be done by the petitioner and to the consequence arising from failure to do that work satisfactorily. It authorises Government to get the work done in that event from someone else and to get it done even at higher prices. Clause 11 provides that the amount due to the petitioner for the work done by him shall be paid in two stages, 90 per cent against 'the delivery of the complete bus' and the balance after the completion of the entire order. It is difficult to understand how any of these two clauses can support the argument that the bodies to be built by the petitioner were composite units to be sold as such.
18. At one stage it was submitted by Mr. Shantharaju that the announcement by the Stores Purchase Committee which called for tenders referred to the price to be quoted by the body builders for each body. When we proceed to ascertain the intention of the parties, we should look into the agreement eventually executed and not to the invitation for tenders, and, even so, we find that what is specified in that invitation for tenders is that the price for building the bodies should be quoted by the tender with respect to each body. That does not mean that the intention of the parties was that the bodies should be treated as independent or composite units to be produced and sold as such. Indeed the preamble to that invitation by the Stores Purchase Committee makes it clear that what the tender was expected to do was the construction of the body and not to make a sale.
19. The order of the Commissioner which does not discuss any of these aspects and which assumes that what was decided in Patnaik's case : 2SCR782 has universal application to all agreements under which one person agreed to build a bus body to another, cannot be supported.
20. We therefore allow this appeal and set aside the order made by the Commissioner and restore that made by the Deputy Commissioner of Commercial Taxes.
21. The appellant will get his costs. Advocate's fee Rs. 250.
SALES TAX APPEAL No. 7 OF 1967.
22. The questions arising in this appeal are the same as those on which we made an adjudication in Sales Tax Appeal No. 6 of 1967 by the judgment which we just now delivered. For the reasons stated in that judgment, we allow this appeal, set aside the order of the Commissioner of Commercial Taxes and restore that of the Deputy Commissioner of Commercial Taxes.
23. The petitioner will get his costs, but not the Advocate's fee.