JUDGMENT D. J. JAGANNADHA RAJU, J. - This is a revision by the assessee against the order dated March 30, 1987, in T.A. No. 618 of 1982 on the file of the Kerala Sales Tax Appellate Tribunal, Ernakulam. The Tribunal by its order confirmed the order of assessment dated January 5, 1981, which relates to the assessment year 1979-80, and which stood confirmed in S.T.A. No. 1489 of 1981 by the Appellate Assistant Commissioner. 2. The facts pertinent for the decision of this tax revision case are as follows : The revision petitioner, Waves Electronics (P.) Ltd., is engaged in the manufacture and sale of electrical goods and it also undertakes contracts for designing, execution and installation of various electrical goods. For the assessment year 1979-80, the petitioner filed a return for Rs. 5,91,332.60 and it did not include in the return the amount of Rs. 1,35,411 which it received towards fabrication, supply and installation of M.V. switch boards for Kunnathara Textiles Ltd., Calicut. That work was executed in pursuance of an order placed by them on November 8, 1977. That amount is not included in the taxable turnover as it represents receipts from a works contract and not from sale of goods. The Sales Tax Officer rejected the contentions and included the same in the taxable turnover. When an appeal was filed on this aspect, the Appellate Assistant Commissioner sustained the order of the assessing authority by order dated January 1, 1982, in S.T.A. No. 1489 of 1981. The Appellate Tribunal in T.A. No. 618 of 1982 affirmed the order. Hence the present tax revision case. 3. On behalf of the revision petitioner-assessee it is contended by Shri K. B. Mohamed Kutty that the assessing authority, the appellate authority and the Tribunal have committed a mistake in treating the amount of Rs. 1,35,411 as taxable turnover. They are not justified in treating it as a contract for sale of goods, simply because the agreement mentions the value of the switch boards as Rs. 1,33,496 and erection charges as only Rs. 1,915. They failed to see that the contract is a composite contract for preparing the drawings for specific needs and then fabricating the switch boards and then installing them and giving a trial run. In the modern parlance it is a contract of works on a turn-key basis from design to execution and installation. 1,915. They failed to see that the contract is a composite contract for preparing the drawings for specific needs and then fabricating the switch boards and then installing them and giving a trial run. In the modern parlance it is a contract of works on a turn-key basis from design to execution and installation. The Tribunal is not justified in coming to the conclusion that the switch boards have a separate commercial identity even before they are assembled and erected. The Tribunal is not justified in construing that there is a simple agreement for sale of switch boards and it is a transfer of chattel to the customer. Shri Mohamed Kutty contends that numerous decisions of the Supreme Court and the High Courts have categorically held that contracts where majority of the value is for the work done are works contracts, though incidentally some goods are sold in such works contracts, especially the material involved in the works contracts has necessarily to be sold to the customer. He places reliance upon the very decisions which are referred to by the Tribunal in its order. 4. On behalf of the Revenue-respondent, the Government Pleader contends that this is a case where the switch boards are to be assembled as per the specifications and designs given by the party and the value of the skill involved in assembling and fabricating the switch boards is very limited. In the very contract it is clearly mentioned that most of the value is for the switch boards and the rate is given per piece. The skill or works part of it is of a minimal character and for the work part of it, namely, the installation, the very contract stipulates an amount of Rs. 2,460, while the assessee claimed Rs. 1,915 only. He contends that this is a simple contract for sale of goods. Hence this amount of Rs. 1,35,411 has to be included in the taxable turnover of the assessee. 5. A perusal of the order of the Appellate Tribunal clearly indicates that the Tribunal relied upon various decisions, but it failed to understand the correct purport of those decisions and it committed a mistake in not applying the principles laid down in those decisions. 1,35,411 has to be included in the taxable turnover of the assessee. 5. A perusal of the order of the Appellate Tribunal clearly indicates that the Tribunal relied upon various decisions, but it failed to understand the correct purport of those decisions and it committed a mistake in not applying the principles laid down in those decisions. To understand the nature of the contract and to find out whether it is a contract for works or a contract for sale of goods, the very document under which the order has been placed has to be perused. It is given at pages 21, 22 and 23 of the paper book. The order clearly mentions that the assessee has to fabricate, supply and instal MV switch boards for Kunnathara Textiles Ltd., Calicut. It clearly mentions that they have to be fabricated and supplied strictly in conformity with the technical specifications for the switch boards enclosed, and as per the general arrangements drawing of Kunnathara Textiles Ltd., the schematic wiring drawings were enclosed. The order itself mentions that the switch boards supplied shall be guaranteed for a period of 12 months against defective design, materials and workmanship. The specifications enclosed are given at page 23. A perusal of page 23 clearly indicates that the very drawings are to be prepared by the assessee. Preparation of drawing, designing, assembling, supply and erection has to be done by the assessee. The clause relating to inspection, testing and trial run clearly stipulates that the switch boards will be finally accepted only after supply, erection, commissioning and trial run to the satisfaction of the receiving party. As regards the clause relating to components, it clearly stipulates that the components should be of the best possible grade, and the list of components and the manufacturers' name should be given along with the control panels, drawings, etc. There are various other stipulations regarding the specifications for the materials to be used and regarding the manner in which the board should be designed and erected. A perusal of the specifications and a reading of the letter dated November 8, 1977, under which the order is placed, clinchingly establishes that this is a contract for works which includes preparation of drawings, designing, assembly, supply and erection and then giving a trial run and giving guarantee for 12 months. A perusal of the specifications and a reading of the letter dated November 8, 1977, under which the order is placed, clinchingly establishes that this is a contract for works which includes preparation of drawings, designing, assembly, supply and erection and then giving a trial run and giving guarantee for 12 months. The skill part of the contract is predominant and the value of the materials is only incidental. It should be remembered that in every contract for works, certain goods are transferred or sold to the vendee, but such goods do not have a separate commercial identity. Only the designed, assembled, and fabricated switch board is useful for a particular party as it is designed for a specific purpose. Seeing the details of the contract, we are fully convinced that this is a case of a contract for works, where the works part of it, namely, the technical skill, preparation of drawings, design, assembling, etc., assumed greater importance. The supply rate indicated in the contract is not only for the materials, but a composite rate including all these factors. It should also be remembered that these switch boards designed for specific purpose cannot be utilised by another party for a different purpose. Bearing in mind these findings of fact, we shall now examine the reasons given by the Tribunal and the decisions relied on by the Tribunal in support of its decision. 6. The Tribunal looking at the table of rates given in the contract came to the conclusion that there are two contracts, and that the first contract is for the supply of switch boards and the second contract is for installation. It failed to give importance to the element of designing and fabrication. Referring to the decision in State of Madras v. Richardson & Cruddas Ltd. [1968] 21 STC 245 (SC), it quoted a passage from Halsbury's Laws of England, Vol. 34, page 6. But it failed to apply the crucial test indicated in that passage. It failed to give importance to the element of designing and fabrication. Referring to the decision in State of Madras v. Richardson & Cruddas Ltd. [1968] 21 STC 245 (SC), it quoted a passage from Halsbury's Laws of England, Vol. 34, page 6. But it failed to apply the crucial test indicated in that passage. The crucial test indicated in that passage is : "The test is whether or not the work and labour bestowed end in anything that can properly become the subject of sale; neither the ownership of the materials, nor the value of the skill and labour as compared with the value of the materials, is conclusive, although such matters may be taken into consideration in determining, in the circumstances of a particular case, whether the contract is in substance one for work and labour or one for the sale of a chattel." If we apply this test to the disputed contract, we find that it is definitely a contract for work and skill and the portion relating to sale of materials is not of much value. 7. The Tribunal referred to decision of the Supreme Court in State of Rajasthan v. Man Industrial Corporation Ltd. [1969] 24 STC 349. There the Supreme Court held that a contract for fixing of window-leaves is a works contract, and it is not a contract for sale of goods. Compared to that decision, in the present case, where switch boards have to be descend to suit specific needs and then assembled stands on a much higher footing, and the present contract is definitely a contract for works. The switch boards pass to the purchaser only after they are installed and given a trial run. To the same effect is the decision in Vanguard Rolling Shutters & Steel Works v. Commissioner of Sales Tax [1977] 39 STC 372 (SC). The Supreme Court laid down that the important test is to find out whether the contract is primarily a contract for supply of materials at a price agreed or it is primarily a contract for work and labour, and materials are supplied in execution of such contract. If we apply the test to the facts of this case, we find that the contract is a works contract. 8. In the penultimate paragraph of the Tribunal's order, the Tribunal committed a factual mistake in thinking that the drawings were supplied by the customer. If we apply the test to the facts of this case, we find that the contract is a works contract. 8. In the penultimate paragraph of the Tribunal's order, the Tribunal committed a factual mistake in thinking that the drawings were supplied by the customer. A perusal of the contract and the specifications clearly indicates that the drawings are to be made by the petitioner-assessee, who undertook the works contract. Only specifications were given by the customer and various standards were insisted upon for the work that is to be executed. 9. Judging from whatever angle, we find that the contract is a works contract. The Tribunal is not justified in coming to the conclusion that the contract dated November 8, 1977, is a contract for sale of switch boards and not a contract for work and labour. The Tribunal was also not justified in coming to the conclusion that the switch board has a separate commercial identity even before it is assembled and erected. The Tribunal is not justified in concluding that the property in the switch board stood transferred to the customer before it is installed. 10. In the result, we allow the tax revision case and answer the reference as indicated above. The amount of Rs. 1,35,411 is not includible in the taxable turnover of the assessee for the assessment year 1979-80. Petition allowed.