Concessional sales tax entitlement for works contracts cannot be defeated by withholding the prescribed certificate.

A statutory concessional sales tax scheme for Government purchases required production of Form D, and the purchasing department had to issue that certificate where the transaction fell within the notified class. Contractual silence on the certificate could not defeat the statutory entitlement, because the notification controlled the tax treatment of goods transferred in execution of a works contract under the expanded meaning of sale in Article 366(29A). Withholding Form D was treated as contrary to the scheme and exposed the contractor to a higher tax rate, so the assessment had to be revisited on the basis of the certificate and the concessional rate applied.

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Issues: Whether the department was bound to issue Form D to enable the contractor to claim the concessional rate of sales tax on goods used in execution of the works contract, and whether the assessment had to be reviewed accordingly.

Analysis: The expanded constitutional meaning of sale under Article 366(29A) includes transfer of property in goods involved in the execution of a works contract. Under the State notification, sales to the Government attracted tax at the concessional rate of 4 per cent if the prescribed certificate in Form D was furnished to the assessing authority. The Court held that the purchasing department could not deny the certificate on the ground that the contract agreement contained no express clause for it, because the statutory scheme and the notification imposed the obligation. Withholding Form D defeated the purpose of the concessional levy and wrongly subjected the contractor to tax at 7 per cent.

Conclusion: The department was required to issue Form D, and the assessing authority was required to review the assessment in light of that certificate.

Final Conclusion: The petitioner was entitled to the concessional tax treatment, and the assessment proceedings had to be revisited on that basis.

Ratio Decidendi: Where a statutory notification grants concessional tax subject to production of a prescribed certificate, the purchasing department must issue that certificate if the transaction falls within the notified class, and contractual silence cannot defeat the statutory entitlement.

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