SEETHARAM REDDY, J.

( 1 ) THE sole, but important question is whether a contract for construction and supply of harbour ferry, constitutes a contract for sale or a contract for work and labour. The question of this nature has been defying easy adjudication since long by the courts of judicature of this country as well as abroad. The search and research in the forensic laboratory has not hitherto discovered a pigeon hole, fixing the given material into one or the other by a strait jacket formula. This search however will continue with the sanguineness that one day a solution will emerge, saving or smashing the sales tax payer.

( 2 ) NOW the facts : The assessee-petitioner carrying on the business of builder and repairer of ships and ferries at Visakhapatnam, entered into an agreement with the Government of India for the "construction and supply of harbour ferry" capable of carrying 200 day passengers as per the specifications and technical particulars of tender at a cost of Rs. 30,60,000 as per the conditions set out in annexure-A of the agreement coupled with conditions of the contract as contained in form No. D. G. S. and D - 68 (Revised) including clause 24 thereof and D. G. S. a

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