J.C Shah, J.— By order, dated August 4, 1969, this Court called for a supplementary statement of the case on the following points:
“(1) Whether the Company charged any profit apart from storage charges for supplying cement and structural steel; and
(2) Whether the difference between the price charged to the contractors and the price paid by the Company to its suppliers for bricks was not in respect of storage and other incidental charges.”
2. The Tribunal has submitted the statement of the case which clearly shows that the Company had not charged any profit for supplying cement and structural steel from its contractors to whom those commodities had been supplied. The Tribunal has also held that even though there was a small difference between the cost price to the Company and the amount received from the contractors, it was not possible to hold that any profit was intended or made by the Company.
3. As we observed in our earlier judgment in Hindustan Steel Ltd. v. State of Orissa 1960 SCD 1080, 35 CLT 1281 the contractors were required to pay for cement in bags Rs 5.94 plus 3½% storage charges and for structural steel and M.S Rods Rs 800 plus 3½% storage charges. It appears that besides that price of steel and cement the Company had also charged freight, insurance and handling charges. But those were evidently expenses which were actually incurred by the Company and must be regarded as part of the price which the Company had to pay. It is clear that the Company had made no profit when it supplied cement and structural steel to the contractors.
4. Similarly in the case of bricks, on the evidence the cost price of bricks supplied to the contractors worked out to Rs 39/8 and the Company had charged Rs 40 per thousand. But in working out the average rate of Rs 39/8 the overhead expenditure of management for “work-charged personnel” was to be taken into account and it was not possible to determine the exact transport charges. The Court agrees with the Tribunal that even in respect of the bricks the rate of Rs 40 per thousand charged by the Company did not leave any profit to it.
5. On the view taken by us, the Questions A, B, C, D and F must be answered as follows:
“(A) in the negative;
(B) in the affirmative;
(C) there was no profit in the supply of cement and structural steel and bricks;
(D) in the affirmative;
(F) in the negative.”
6. The appeals are therefore, allowed and the order passed by the High Court is set aside. There will be no order as to costs in these appeals in this Court.