Works contract concessional purchases and exclusion from taxable turnover were upheld under settled sales tax precedent.

A works contractor's entitlement to purchase goods on concessional forms was treated as settled by binding precedent, so the concession was upheld in favour of the dealer. Goods that had already suffered tax in a series of sales were excluded from taxable turnover, and the Court followed prior authority rejecting any fresh levy on the same transaction chain. The claim for deduction of the value of goods purchased on C forms was also accepted, with the conditions under the CST Rules treated as not requiring any adverse finding on the facts, leaving all referred questions in favour of the assessee.

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Issues: (i) Whether a works contractor was entitled to purchase goods at concessional rate of tax on the strength of C forms and to use form IV for concessional purchase of goods. (ii) Whether a series of sales could be postulated under section 8 of the Central Sales Tax Act, 1956 even though tax had been paid while purchasing the goods. (iii) Whether deduction of the value of goods purchased on the strength of C forms could be allowed when the conditions under section 8(3)(b) of the Central Sales Tax Act, 1956 read with rules 12(1) and 13 of the Central Sales Tax (Registration and Turnover) Rules, 1957 were not satisfied.

Issue (i): Whether a works contractor was entitled to purchase goods at concessional rate of tax on the strength of C forms and to use form IV for concessional purchase of goods.

Analysis: The entitlement of a works contractor to obtain goods on concessional forms was already settled by binding precedent. The Court treated the question as no longer res integra and followed the earlier Full Bench decision, which had answered the issue in favour of the dealer. The Court also noted that the dealer had deposited tax at the same rate applicable to works contract tax, so no different tax consequence arose.

Conclusion: The issue was answered in favour of the assessee and against the Revenue.

Issue (ii): Whether a series of sales could be postulated under section 8 of the Central Sales Tax Act, 1956 even though tax had been paid while purchasing the goods.

Analysis: The Court held that this question had already been concluded by earlier authority. It relied on prior decisions holding that where goods involved in a works contract had already suffered tax in a series of sales, such goods were to be excluded from taxable turnover. The Court also referred to the principle that a State cannot tax a deemed sale which is in the course of inter-State trade, outside the State, or in the course of import or export.

Conclusion: The issue was answered in favour of the assessee and against the State.

Issue (iii): Whether deduction of the value of goods purchased on the strength of C forms could be allowed when the conditions under section 8(3)(b) of the Central Sales Tax Act, 1956 read with rules 12(1) and 13 of the Central Sales Tax (Registration and Turnover) Rules, 1957 were not satisfied.

Analysis: This question was treated as covered by the same binding authority that resolved the concessional form entitlement in favour of the dealer. In the circumstances of the case, the Court found the question to be academic and not requiring any further adverse finding against the dealer.

Conclusion: The issue was answered in favour of the assessee and against the Revenue.

Final Conclusion: All referred questions were resolved in favour of the dealer, and the revision was brought to an end without any further relief being required.

Ratio Decidendi: A question already settled by binding precedent in favour of a works contractor need not be reopened, and goods in a works contract that have already suffered tax in a series of sales are excluded from taxable turnover under the applicable sales tax framework.

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