1. This appeal is directed against an order of the Board of Revenue by which in exercise of its suo motu powers of revision, it reversed an order of the Appellate Assistant Commissioner of Sales Tax and brought to tax a turnover of Rs. 43,396 on the view that it composed of sales of pebbles. The Board's view is that, on a construction of the contract, the parties intended sale and purchase of materials and not execution of works.
2. We have no hesitation in upholding the order of the Board of Revenue. In cases like this, as has been pointed out by this Court on more occasions than one, the primary task is one of construction of the contract, as to whether the terms read as a whole disclose an intention to sell and purchase goods as such. In construing the contract, it will naturally be borne in mind how and when the property passes in the process of execution of the contract and how the risk in relation to the property is borne and by whom. The original contract is unfortunately not before us. But the learned counsel for the assessee produces a copy of a contract and says that the terms therein are similar to those in the contract in question. This has not been disputed for the revenue. The contract has been entered into between the Neyveli Lignite Corporation on the one hand and the assessee on the other for supply of pebbles of certain specifications collected from a site belonging to the Government and in respect of which the Corporation has obtained a licence for quarrying on payment of seigniorage fee. The name of the work is described in the contract as 'procurement of pebbles required for buildings in the Neyveli Township'. Certain columns have been tabulated, and under the one 'class and description of work to be executed' is mentioned collection of pebbles of certain sizes and conveying the same to the specified spot. The consideration is paid at the rate of so much per 100 c.ft. of pebbles supplied. At the end of the contract there is a note to the effect that the contractor, namely the assessee, shall pay the requisite seigniorage fee of Re. 0.30 nP. per unit of 100 c.ft. payable to the. Revenue Department, and the further stipulation is that the seigniorage charges shall be recovered from the assessee's bills for the quantity of pebbles collected and supplied by him. The Appellate Assistant Commissioner thought that this was a case of works contract, because Neyveli Lignite Corporation has been permitted exclusively to quarry from the particular village, though the seigniorage fee is actually recovered from the bills of the assessee. He added that permission having been obtained by the Corporation from the Revenue Department for quarrying pebbles in the site and the Corporation in its turn having permitted the assessee to quarry at the spot, it was explicit that the assessee was only utilised to do the work. The Board of Revenue did not accept that view and considered that it was equally explicit that the assessee on payment therefor quarried at the licensed site, collected the pebbles and delivered the same to the Corporation as pebbles and this the transaction was a sale of goods.
3. Before us, it has been argued for the assessee that the quarrying licence being in favour of the Corporation exclusively, the assessee acquired no property in the pebbles at any time and that the payment made to him was for quarrying, in other words, for the work and labour. The whole argument is rested on passing of property. The short answer to this is that, if it was a case of pure work and labour, it is difficult to see the purpose of the assessee being required to pay the seigniorage fee which the Corporation is liable to pay to the Government. In fact the contract provides for recovery of this fee from the bills of the assessee. That to our minds clearly brings out the intention that the pebbles when removed from the earth became the property of the assessee, and they were delivered to the Corporation at the agreed site as the property of the assessee. That means the transaction is a sale of goods.
4. A few decided cases have been cited before us, but before we notice some of them, it should be observed that each case has been decided on the particular facts. Bakthavatsalu v. State of Madras  14 S.T.C. 832 is a case where the assessee himself was the owner of the goods supplied, unlike Mooljee Ramjee and Sons v. Deputy Commissioner (Commercial Taxes)  17 S.T.C. 255 where the purchaser not own any property in the goods supplied. In both these cases the Court took the view that the relative transactions were sales of goods, applying the principles of transfer of property. Calcutta Company Limited v. Commissioner of Sales Tax  15 S.T.C. 554 has been strongly relied on for the assessee, but we find it, with due respect, difficult to follow the ratio of that case. Chandra Bhan Gosain v. State of Orissa  14 S.T.C. 766 is nearer on principle to the facts of this case. There, the assessee manufactured and supplied large quantities of bricks to a certain company under a contract. The assessee was to take earth free of cost from land belonging to the company and manufacture bricks out of it and supply the same. The Supreme Court held that under the contract there was a transfer of property in the earth to the assessee, that though the contract itself did not mention sale, there was also a transfer of property in the bricks from the assessee to the company for consideration and that therefore the transaction was a sale of goods. In the instant case too, as we already noticed, there is a specific stipulation for payment by the assessee and recovery from his bills of the seigniorage fee which the Corporation was liable to pay to the Revenue Department for quarrying the pebbles in the licensed site.
5. Our attention has been invited to a recent judgment of a Division Bench of this Court in C. Krishnaswami Rao v. The State of Madras T.C. Nos. 165, 206 and 207 of 1964; since reported at page 146 supra but it is, in our opinion, distinguishable, because there was no stipulation for payment for the earth out of which brick was made.
6. The tax appeal is dismissed, but with no costs.