Amiya Kumar Mookerji, J.
1. This rule is directed against an order dated 21st December, 1970, passed by the Additional Member, Board of Revenue, West Bengal, confirming the order of the Commercial Tax Officer dated 17th May, 1966, by which, the petitioner's liability to pay tax under Section 4(2) read with Section 4(5)(a) of the Bengal Finance (Sales Tax) Act, 1941, was determined.
2. The petitioner is a partnership-firm carrying on business under the name and style of 'Eastern Galvo-Aluminizing & Engineering Works', having its chief place of business at 59, Gray Street, Calcutta-6. The business of the firm was started on 1st January, 1964. The nature of the petitioner's business is of (i) executing individual works contract, viz., galvanization of steel works supplied and belonging to the customers, (ii) manufacturing in West Bengal for sale of engineering goods, e.g., fabricated steel structures and galvanized materials, and (iii) executing pure and simple labour contract. A sales turnover of Rs. 46,377.47 effected during the period from 1st April, 1965 to 23rd March, 1966, was shown in the application for registration filed under the Act on 23rd March, 1966. In compliance with a notice under Section 14(1) of the Act, the petitioner-firm produced before the Commercial Tax Officer on 17th May, 1966, all relevant books, accounts, documents, contracts and purchase orders including copies of the bills. On scrutiny of the records, the Commercial Tax Officer observed in his order dated 17th May, 1965 'they undertake mainly fabrication work and galvanizing with materials supplied by the customers. They also manufacture cover angles'. It is also stated in the said order that in fabrication work they seldom supply any material but considerable quantity of zinc is supplied in the case of galvanizing work. Sales exceeded Rs. 10,000 on 7th June, 1964, per sales register show ing bills for galvanizing work, as such the dealer is liable to pay tax from 8th August, 1964. According to the petitioner, the fabrication and galvanizing work executed by them with the materials supplied by the customers partook of the nature of indivisible works contract without involving any divisible agreement for sale of chattel qua chattel. The Commercial Tax Officer held, by his order dated 17th May, 1966, that the petitioner attracted liability to pay tax under Section 4(2) read with Section 4(5)(a) of the Act on and from 8th August, 1964. The petitioner preferred a revision petition before the Assist ant Commissioner of Commercial Taxes, Calcutta. By an order dated 3rd September, 1966, the Assistant Commissioner rejected the petitioner's revision petition. The petitioner preferred further revision petition under sec tion 20(3) of the Act before the Additional Commissioner of Commercial Taxes. It was contended before him that (1) in some cases, the railways sup plied steel and zinc which were galvanized by the petitioner, i.e., the entire materials for fabrication were supplied by the railways and the petitioner only executed labour contract, (2) in some other cases, the railways supplied steel and the petitioner themselves supplied their own zinc with which they did the fabrication and (3) in some other cases, the petitioner had made pure and simple sales of goods. The Additional Commissioner found that so far as the second category was concerned, the materials were supplied by the petitioner, so the transaction under that category was rightly considered as involving sales of materials and, according to the petitioner's sales register, the Commercial Tax Officer found that such sales had exceeded taxable turnover of Rs. 10,000 on 7th June, 1964, and, accordingly, the petitioner was liable to pay tax under Section 7 of the Act. The petitioner's further revision petition before the Additional Member, Board of Revenue, was rejected by an order dated 20th December, 1970. The petitioner being aggrieved, moved this Court in an application under Article 226 of the Constitution and obtained the present rule.
3. Mr. Chakraborty, appearing on behalf of the petitioner, contended that, on the facts and circumstances of the present case and having regard to the available materials including contract and documents, the Additional Member, Board of Revenue, should have found and held that the amount received by the petitioner from galvanizing and/or fabrication contract did not constitute any part of the sales turnover and the Tribunals below had committed an error in not excluding from the turnover the said amount. The Tribunals below committed an error in holding that the materials, viz., zinc were supplied by the petitioner in the fabrication made by them and the transaction under that category was considered as involving sale of materials. The Tribunals, according to Mr. Chakraborty, had fallen into an error in confusing between a mere supply of materials used or consumed in the execution of works contract as a 'sale' of those materials as such. Reliance was placed by Mr. Chakraborty on three decisions of the Supreme Court: Government of Andhra Pradesh v. Guntur Tobaccos Limited  16 S.T.C. 240 (S.C.), State of Gujarat v. Kailash Engineering Co. (Pvt.) Ltd.  19 S.T.C. 13 (S.C.) and State of Madras v. Richardson & Cruddas Limited  21 S.T.C. 245 (S.C.).
4. Mr. Mukherjee, appearing on behalf of the revenue, contended that the petitioner was producing a distinct item for sale, namely, galvanized materials, amongst others, as declared in form I(B) and galvanization made by the petitioner with their own zinc should be held as sales of goods and assessed to sales tax. Mr. Mukherjee drew my attention to some of the relevant clauses in the agreement and contended that raw materials, namely, fabricated portals were supplied by the railway to the petitioner-company and the petitioner galvanized those materials in their factory using materials, viz., zinc purchased by them. According to Mr. Mukherjee, by the process of galvanizing, a new thing, viz., 'galvanized portals' were produced by the petitioner. The rate of galvanization work also included the sales tax. As such the petitioner was liable to pay sales tax on the gross turnover, which exceeded Rs. 10,000.
5. Clause 2 of the special conditions of the contract provides price of stores shall include all rates, taxes, etc. The rates for the works are also to include all rates, taxes, levies, imposition and outgoings whatsoever and the railway shall have no liability for any of these charges. The contractors shall, during the progress of work, be entirely responsible for the handling and custody of the stores and he shall take appropriate and necessary protections against theft, accident, injury or loss to the materials. The railway will supply zinc sphalerites required for the work from railway stores depot at Naihati at a fixed rate of Rs. 1,060 per metric tonne. The contractor will have to make arrangement, transport, loading and unloading of the same for which no separate payment will be made. The contractor will have to deposit the cost of zinc in advance in cash with the Assistant Chief Engineer, railway electrification, and necessary delivery order will be issued on production of the said receipt to the executive engineer. The contractor shall not except to the extent specifically agreed to by the railway in the acceptance of tender, be entitled to assistance in the procurement of zinc sphalerites only (by way of quota certificate) required for due fulfilment of the contract. Payment for galvanization of steel work will be made for the net estimated black weights of portals and allied steel works. The railway will arrange for supply of all fabricated portals and allied steel works to the contractor's workshop and will also arrange for transporting the galvanized steel sheets from the contractor's works, but loading of these finished materials to railways or its appointed agents shall be done by the contractor for which no separate payment will be made.
6. Referring to the above provisions of the contract, it is contended by the revenue, that raw 'portals' were supplied by the railways and the zinc was purchased by the petitioner. When these materials were applied by a skilled process known to the petitioner, new finished materials were produced and those finished goods were delivered to the railways at the cost of the petitioner-company. So, the petitioner really sold the 'finished goods' to the railways and did not merely execute the labour contract. According to the revenue, the contract is divisible.
7. In Guntur Tobaccos Ltd.'s case  16 S.T.C. 240 (S.C.), the Supreme Court observed that although in the execution of a contract for work some materials are used and property in the goods so used passes to the other party, the contractor undertaking the work will not necessarily be deemed, on that account, to sell the materials. A contract for work in the execution of which goods are used may take one of three forms. The contract may be for work to be done for remuneration and for supply of materials used in the execution of the works for a price; it may be a contract for work in which the use of materials is accessory or incidental to the execution of the work ; or it may be a contract for work and use or supply of materials, though not accessory to the execution of the contract, is voluntary or gratuitous. In the last class there is no sale because though property passes it does not pass for a price. Whether a contract is of the first or of the second class must depend upon the circumstances ; if it is of the first, it is a composite contract for work and sale of goods; where it is of the second category, it is a contract for execution of work not involving sale of goods.
8. In State of Gujarat v. Kailash Engineering Co. (P.) Ltd.  19 S.T.C 13 (S.C.), the respondent, an engineering concern, constructed three coaches over the chassis supplied by the western railway administration under a contract with the latter and received money therefor. It was provided in the contract that as soon as the plant and materials were brought on the site where the coaches were to be constructed, the ownership in them would vest in the railway. The coach bodies were not separately described as units or components to be supplied by the respondent to the railway. The duty of the respondent was described throughout the contract to be that of constructing, erecting and furnishing coach bodies on the underframes supplied. At no stage did the contract mention that ready coach bodies were to be delivered by the respondent to the railway. In fact, even from the earliest stage during the process of construction of the coach bodies, the unfinished bodies in the process of erection were treated, under the terms of the contract, as the property of the railway since those unfinished bodies were to be in the charge of the respondent during the construction, the respondent was made liable under the contract to reimburse the railway for loss by fire, etc. On construing the contract the Supreme Court held that as the terms of the contract indicated that the respondent was not to be the owner of the ready coaches and that the property in those bodies vested in the railway even during the process of construction, the transaction was clearly a works contract and did not involve any sale.
9. In Richardson & Cruddas Ltd.'s case  21 S.T.C. 245 (S.C.), the respondent entered into contracts with the customers at an inclusive price for the work of fabrication of bottle cooling equipments required in the premises of the customers and for installation of the equipment. Under the contract the respondent undertook to fabricate different parts of the unit according to the special requirements of the customer and to instal the unit in the premises of the customer. The Supreme Court held, on the facts, that the contract being one for supplying for an inclusive price a specially designed fabricated unit to be assembled and installed by specially trained technicians in the premises of the customer, it was not a contract for sale of a unit or different parts of the unit as specific goods, but was a works contract.
10. It is abundantly clear from the contract that the property in the goods, viz., raw steel portals were all along remained with the railway authorities. A contract of sale is a contract whose main object is the transfer of property in goods and delivery of the possession of the said goods to the buyer. In order to attract the liability of sales tax under the Act it has to be established that the petitioner had sold certain specific goods and the consideration was received under a contract to sell those specific goods for a price and the property in the goods contracted to be sold passed to the buyer. It is nowhere stated in the contract that it was a contract for sale or supply of goods. It was a contract for galvanization of fabricated steel work with the contractor's own zinc. Zinc is the main material which is required for galvanization. Under the terms of the contract the zinc would be supplied by the railway at a price to be paid by the petitioner. The use of such material is accessory to the execution of galvanizing work.
11. In Guntur Tobaccos Ltd.'s case  16 S.T.C. 240(S.C.), the Supreme Court has clearly laid down that the use of materials which is accessory or incidental to the execution of the work does not involve sale of goods. In my opinion, the present case is directly covered by the above decision of the Supreme Court and no sales tax can be imposed with respect to galvanizing of portals supplied by the railways. The contract was a works contract and did not include any sale of goods.
12. In the result, this rule is made absolute. The impugned orders of the Additional Member, Board of Revenue, Additional Commissioner of Commercial Taxes, the Assistant Commissioner of Commercial Taxes, Calcutta North, and the order dated 17th May, 1966, passed by the Commercial Tax Officer, Manicktola Charge, are quashed by a writ of certiorari.
13. Let a writ in the nature of mandamus be issued directing the respondents not to give effect to the said impugned orders.
14. There will be no order as to costs.