The main legal point established in the judgment is the interpretation of the definitions of 'sale' and 'works contract' under the Tamil Nadu General Sales Tax Act, 1959, and the application of these definitions to determine the nature of the transaction.

(Prayer: Petitions under Article 226 of the Constitution of India for issue of a writ of Certiorari to call for the records in T.C.(R) Nos.121 to 127 of 1998, dated 11.3.2002 on the file of the third respondent and to quash the same.)

P.D. Dinakaran, J.

These writ petitions arise out of the common order of the Tamil Nadu Taxation Special Tribunal, Chennai dated 11.3.2002 made in T.C.(R) No.121 to 127 of 1998, raising a question, whether in a case, where, the petitioner has undertaken manufacture and supply of RCC Poles to the Tamil Nadu Electricity Board (for brevity, "the Board") at an agreed rate, agreeing for the manufacturing work as per the terms of the agreement dated 17.3.1990 entered into between the petitioner and the Board, which agreement provides for supply of raw materials like cement and steel required for the work to be supplied by Board; the petitioner has to make his own arrangement for transport and storage of the said materials; if steel is not available with the Board, the petitioner may provide the required quantity for the work at his own cost, and recover the same out of the final bills; the petitioner has to return the excess materials and gunny bags after the completion of the work; the income tax payable on the contract amount bill would be deducted from and out of the payment to be made to the petitioner in accordance with the provisions of the Income Tax Act, 1961 as tax deducted at sources (TDS); the payment of the Sales tax, if any made applicable by the Government of Tamil Nadu for the pole manufacturing works shall be borne by the Board and the contractor is entitled to make claim if any on production of the notice issued by the Government of Tamil Nadu, the said contract was for sale of goods, viz., RCC Poles or contract for work, for the supply of the labour, out of the materials supplied by Board.

2. To decide the above question, we are constrained to look into the essence of the agreement and find out what was the intention of the parties in making the contract, viz., Manufacture of RCC Poles and Grills out of the materials supplied by the Board and transfer to the Board; and to decide whether such transaction is substantial one for execution of work or is for performance of some service or sale of RCC Poles by themselves, qua the assessment years 1989-90 to 1994-95.

3.1. All these writ petitions arise out of a single agreement entered into between the petitioner and Board on 17.3.1990, which was accepted and acted upon by the said parties for manufacture and supply of 3000 Nos. 7.5 Mtrs. RCC Poles and Grills. Pursuant to the said agreement, the Board also obtained a certificate of registration dated 26.6.1992, under the provisions of Central Excise Rules, specifically mentioning the address of manufacturing yard as there own premises situated at S.No.162/1, Kadiramangalam, Mayiladuthurai Taluk. Subsequently, the Board also paid excise duty for having manufactured the said poles.

3.2. Before proceeding further, it is apt to refer to some of the vital terms and conditions of the agreement dated 17.3.1990 entered into between the petitioner and Board.

3.2.1. It is specifically agreed that the petitioner/ contractor shall execute the work on the description specified by the Board by piece-work and in accordance with the conditions noted in the agreement for the quantity of work to be executed as per the said agreement. The agreement also defines piece-work as that which involves a payment for work done at stipulated rate only without reference to a total quantity or time.

3.2.2. Condition (1) of terms and conditions of the tender provides that a list of materials proposed to be supplied by the Board and the place where and the prices at which they are proposed to be supplied is given in the tender, and the tenderer must accept these materials at the specified prices and quote for finished work accordingly.

3.2.3. Condition (2) of terms and conditions of the tender provides that subsidiary