JUDGMENT

BHAGWATI J.:—This appeal by special leave raises the vexed question whether a particular contract is a contract of sale or a contract of work and labour. This has always been a difficult question, because most of the cases which come before the courts are border-line cases and the decisions given by courts are by no means uniform. But so far as the present case is concerned, it does not present any serious difficulty and is comparatively free from complexity or doubt, for there is a decision of this Court which is directly applicable and is determinative of the controversy between the parties.

2. The assessee who is the appellant before us is a private limited company carrying on business as engineers, contractors, manufacturers and fabricators and in the course of its business, it entered into a contract dated 28th June, 1972 with M/s C. M. Shah 7 Co. (P) Ltd. (hereinafter referred to as the Company) for fabrication, supply, erection and installation of Sentinels Pull Push type and reduction Gear Type Rolling Shutters in sheds Nos. 3 and 4 of the Sidheshwar Sahakari Sakar Karkhana belonging to the Company. The detailed specifications of the Rolling Shutters were given in the contract and the price was stipulated to be Rs. 7/- per sq. ft. and ft. for Pull and Push Type Rolling Shutters and Rs. 9/- per sq. ft. and rft. for the Reduction Gear Type Rolling Shutters, the price in both cases being inclusive of "erection at site". The contract was expressed to be subject to the terms and conditions set out in a printed form and there were also certain special terms and conditions which were specifically written out in the contract. Since considerable reliance was placed on behalf of the Revenue on some of the printed terms and conditions of the contract, we shall set them out in extenso:

"2. Once the delivery of the goods is effected, rejection claims cannot be entertained.

4. All erection work shall be carried out at Customers own risk and no claim for incidental structural breakages, damages to the property of the customers or others shall be entertained. All masonry works required before and or after erection shall be carried out by customers at own cost.

10. All payment shall be on overall measurements only. Customer desiring to check the correctness of the overall measurements shall notify their intention in advance and shall get the measurements checked before installation. No dispute on this ground shall be entertained once the erection is completed.

12. Terms of Business: 50% advance with the order and the balance against delivery of the goods ex-work prior to erection, or against through Banks."

The special terms and conditions provided that the actual transportation charges would be in addition to the price stipulated in the contract and the delivery would be 6/8 weeks ex-works from the date of receipt of the final confirmation of the order. The terms of payment also formed part of the special terms and conditions and they provided "25% advance, 65% against delivery and remaining 10% after completion of erection and handing over of shutters to the satisfaction" of the Company. The assessee carried out its part of the contract and manufactured the two types of Rolling Shutters according to the specifications provided in the contract and erected and installed them in sheds Nos. 3 and 4 of the Sideswar Sahakari Sakar Karkhana. It does not appear from the record as to when the bill relating to the contract was submitted by the assessee to the Company, but it was dated 19th August, 1972 and presumably it was sent by the assessee after the fabrication of the two types of Rolling Shutters was completed, but before they were erected and installed at the premises of the Company. Since the assessee entertained doubt as to whether the contract was a contract for sale or a contract for work and labour, the assessee made an application dated 16th Sept. 1972 to the Commissioner of Sales Tax for determining this question, for on the a