( 1. ) THIS judgment shall also dispose of Miscellaneous Civil Cases Nos. 547 and 778 of 1974.

( 2. ) THESE are three references made by the Sales Tax Appellate Tribunal (Board of Revenue) referring for our answer two common questions of law which are as follows: (1) Whether or not, on the facts and circumstances of the case, the assessee is liable for sales tax in respect of the estimated value of the gunny bags which were used when sugar was sold by the assessee and which were in conformity with the standard prescribed by Clause (a) of the order G. S. R. 718-Ess. Com/ Sugar dated 20th May, 1961 ? (2) Whether or not, on the facts and circumstances of the case, the assessee is liable to pay sales tax on the sale of one truck, one jeep and one car during the accounting period 1964-65 and one truck during the accounting period 1966-67?

( 3. ) THE periods of assessment covered by these references are from 1st October, 1964, to 30th September, 1965, and 1st October, 1966, to 30th September, 1967. The assessee is a manufacturer of sugar which was sold during both the periods packed in gunny bags. Sugar is an exempted commodity. In the assessment in respect of the first period, a sum of Rs. 1,32,248 representing the value of the gunny bags in which the sugar sold by the assessee was packed, was included in the turnover and the assessee was taxed on it under the Madhya Pradesh General Sales Tax Act, 1958. Similarly, in respect of the second period, the assessee was taxed on a sum of Rs. 1,29,555 under the Central Sales Tax Act, 1956, and on a sum of Rs. 9,250 under the State Act, both amounts representing the value of gunny bags in which the sugar sold by the assessee was packed. Besides this, in respect of the first period, the assessee was assessed to sales tax under the State Act on the sales of old vehicles, i. e. , one jeep, one car and one truck which were sold respectively for Rs. 7,600, Rs. 3,300 and Rs. 4,700. In respect of the second period, the assessee was assessed to sales tax on the sale of one truck which was sold for Rs. 6,850. The Tribunal maintained the assessment of sales tax on gunny bags for both the periods. The Tribunal also maintained the assessment on the sales of trucks. The assessment on the sales of car and jeep was set aside. The first question in these references has been referred at the instance of the assessee and the second at the instance of the Commissioner of Sales Tax.

( 4. ) IN stating the case, the Tribunal has clearly stated that there was no evidence on record to show that there was an express or implied contract to sell the gunny bags along with the sugar sold by the assessee. The assessing authority observed in the assessment orders that the assessee did not object to the inclusion of gunny bags as containers of sugar in the category of taxable goods. This observation was disputed by the assessee before the first appellate authority as also before the Tribunal. From the case stated by the Tribunal, it cannot be held that the assessee accepted that there was express or implied sale of gunny bags used as packing material or containers of sugar sold by the assessee. The first appellate authority and the Tribunal did not maintain the order of the assessing authority on any admission made by the assessee but by relying upon their previous decisions relating to an earlier period.

( 5. ) THE statement of the case further shows that the price of sugar during the whole of the relevant periods was controlled under the Sugar Control Order, 1955. Ex factory price of sugar was fixed per bag from time to time by the Government. The expression "ex factory price" is defined under Section 2 (b) of the Control Order to mean in so far as relevant "the price of sugar inclusive of excise duty, packed as may be prescribed". The Government issued an order on 20th May, 1961, under clause 7 of the Sugar Control Order which provided that unless otherwise permitted by the Central Government, with effect from 1st