Works contract deduction under sales tax rules upheld after valid revision and failure to use statutory appeal.

Electrical contract work falling within rule 6(4)(m) of the Karnataka Sales Tax Rules, 1957 attracted the prescribed deduction treatment, and the revision reducing the labour and similar charges deduction from 30 per cent to 20 per cent was found to conform to the statutory scheme. The assessee had received notice, an opportunity to object, and a personal hearing before revision, and the earlier order enhancing the deduction to 30 per cent had not been challenged before the statutory appellate forum under section 22 of the Karnataka Sales Tax Act, 1957. In these circumstances, the assessee could not bypass the available appeal and seek remand in writ proceedings, and the revised order was upheld.

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Issues: Whether the assessee was entitled to have the matter remanded for fresh assessment and whether the restriction of deduction towards labour and other like charges to 20 per cent, instead of 30 per cent, was justified under the Karnataka Sales Tax Act and the Rules.

Analysis: The assessee was engaged in electrical contract work, which fell within the relevant works contract category under rule 6(4)(m) of the Karnataka Sales Tax Rules, 1957, and not under rule 6(4)(n). The orders under challenge showed that the assessee was given notice, opportunity to object, and personal hearing before the Additional Commissioner revised the deduction from 30 per cent to 20 per cent. The Court also noted that the earlier order enhancing the deduction to 30 per cent had not been challenged before the statutory appellate forum under section 22 of the Karnataka Sales Tax Act, 1957, and the assessee could not bypass that remedy and seek remand in the writ appeal. The impugned order was found to be in conformity with the statutory provisions governing works contract deductions.

Conclusion: The assessee was not entitled to remand, and the order restricting deduction to 20 per cent was upheld.

Final Conclusion: The appeal failed because the impugned revision order was consistent with the statutory scheme and the assessee had not pursued the available appellate remedy against the earlier order.

Ratio Decidendi: Where a works contract falls within the specific rule governing that class of contract, the prescribed deduction applies, and a party that has not availed the statutory appeal against an earlier order cannot later seek remand to avoid the effect of a valid revision.

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