A transaction in order to be a sale must have all the necessary characteristics of a sale. It is necessary that there should be an agreement between the parties for the purpose of transferring the title to goods which presupposes capacity to contract, that it must be supported by money consideration, and that as a result of the transaction the property must actually pass in the goods.

DESAI, J. - The respondents are dealers carrying on business in electric goods as electrical contractors and hold a registration certificate under the Bombay Sales Tax Act, 1959. In the course of their business they undertake contracts for electrical fittings and charge their customers consolidated rates for the materials consumed and the labour charges involved in carrying out the contracts. On the 13th July, 1960, they made an application to the Deputy Commissioner of Sales Tax, Bombay City Division, under section 52(c) of the Bombay Sales Tax Act, 1959, to determine whether the supply of materials consumed in carrying out the contracts of electric fittings undertaken by them would be treated as sales within the meaning of the Bombay Sales Tax Act, 1959, and whether they would be liable to pay any sales tax on them. To indicate the nature of their transactions with their customers they annexed along with their application a copy of the bill issued by them to one of their customers. The material contents of the said bill were as follows :-

1. Supplying and fixing the materials of light points complete with 1/18th CTS wire, brass clips, tapes and all approved accessories 2 Pts. Rs. 32-00

2. Supplying and fixing 9" brass Swan type wall brackets with holders 1 pc. Rs. 1-75

3. Supplying, fixing and wiring 40 kw. 4 ft. tubes complete with Resmi choke, imported starters and Elore holders etc. 5 pc. Rs. 132-50 ----------- Total Rs. 166-25 ------------

At the hearing of the said application the respondent contended before the Deputy Commissioner of Sales Tax that the transaction evidenced by the bill was purely a works contract which was one and indivisible and did not involve any sale of goods. It was also contended on their behalf that the materials supplied in the execution of the contract were affixed to the building and thus became a part of the immovable property at the time when the property in the said material passed on to the customer. They urged that the contracts entered into by them were similar to the contracts of building constructions, which the Supreme Court had held, were contracts of work not involving sale of goods. The Deputy Commissioner of Sales Tax did not accept these contentions which were put forward on behalf of the respondents. According to him, although there was a single invoice given by the respondents to their customers, the contract evidenced by the said invoice clearly consisted of distinct and severable contracts - one for the supply of goods and the other for the supply of work and labour; and so far as that part of the composite contract which consisted of the supply of goods was concerned it constituted a sale within the definition in the Bombay Sales Tax Act, 1959. He relied on the observations of the Supreme Court in the case of State of Madras v. Gannon Dunkerley & Co. ([1958] 9 S.T.C. 353), to the effect that it was possible that parties might enter into distinct and separate contracts one for the transfer of materials for money consideration and the other for the payment of remuneration for the service and for the work done and where such was the position, there were really two contracts although there might have been a single instrument embodying them, and took the view that the present case fell in the category of such contracts and therefore involved a sale of goods so far as the supply of material was concerned. As to the other argument advanced before him, that the property in the goods did not pass as movables, but only after they had been fixed to the building and had become a part thereof, he held that it could not be said that the goods mentioned in the invoice were permanently fastened to the build