P. Balakrishna Mudaliar vs The State of Madras

Ramakrishnan, J.—The assessee is described in the order of assessment as proprietor, Chitra Painters and he undertakes to do paintings

used for the purpose of advertisement by customers. The nature of his work appears to be this. The customers give him orders for painting. Some

of them supply boards on which the paintings have to be painted. In other cases, the assessee himself buys the boards and paints on them, and sells

the paintings. The department has excluded from the assessable turnover those cases where he had painted on boards supplied by customers and

delivered the paintings, and assessed him on a turnover of Rs. 12,000 and odd which covers cases where he had painted on boards purchased by

him for the customers. The Appellate Assistant Commissioner and the Appellate Tribunal confirmed this order and the assessee has filed this

present revision against the assessment.

As mentioned already, the disputed turnover consists of cases where the assessee has himself purchased boards, drawn pictures on them for the

purpose of advertisement and supplied the finished products to the customers charging them a consolidated rate under the heading "" art work with

boards "". The customers have bargained with the assessee for his skill in painting suitable paintings for the purpose of advertisement. Learned

counsel for the petitioner submits that most of these advertisement paintings are intended for cinema producers. Even such paintings require a great

deal of skill. The paintings have to be drawn on large sized boards, suitable for appreciation by people who look at them even from a distance. It

cannot be denied that in drawing such paintings, art and skill are involved and that the customers seek the services of the painter principally for his

art and skill. The supply of boards is only ancillary to the contract. Because some of the customers found it inconvenient to purchase boards for

themselves, the assessee to oblige them supplied boards and made an inclusive charge therefore in the bills. But that will not make the transactions

sales of the finished paintings as if they were specific goods. The bargain is primarily for work and labour. The transfer of property in the shape of

boards is only ancillary to the main contract. The turnover is clearly not liable to sales tax.

The revision is allowed and the assessment on the disputed turnover is set aside. The penalty imposed is also set aside. No order as to costs.