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of <h1>High Court: Safety barriers on national highway considered part of road construction. Controversy resolved.</h1> The High Court ruled in favor of the respondent, determining that fixing safety barriers on the national highway constituted part of road construction. ... Denial of exemption claim - fixing and providing of Works Profile Safety Barrier - part of road construction activity or not - Assessing Officer came to the conclusion that certificate of exemption though was related to every part of Roads but fixing and providing of Works Profile Safety Barrier could not be said to be relating to roads but these were safety steel barriers and could be used for the other purposes, other than road, therefore, withdrew the benefit available to the respondent-assessee granted vide Certificate of Exemption No.6/45 Held that:- The AO, in the last part of the assessment order, has observed that as per notification dt.28/04/1993. Exemption fee @1% was chargeable on the entire work related to Roads. Therefore, when the entire work relating to Roads has been charged @ 1% as per notification dt.28/04/1993, then to say that fixing of “W. Profile Safety Barrier” was not used for the purposes of Roads, is unjustified on the part of the AO. When the notification itself says that exemption fee is to be charged @1%, relating to safely work of road, then in my view, it is part and parcel of providing and fixing, may be at Toll Plaza but it is certainly part of a road. Merely putting concrete, grit, coaltar cannot be said to be a road but in the present day conditions, when Mega Highways are being constructed, as in the present case, which is National Highway No.8, relating to Jaipur-Delhi National Highway, certainly one is required to have latest technology and safely measures installed which would certainly be part and parcel of roads. To say that fixing of W. Profile Safety Barrier is not relating to road, in my view, is contrary to what can be said to be part of a road. - Developing/constructing a road over the years require latest technology and it is not merely putting concrete, grit, coal tar etc but many more things. The words “relating to” has a wide meaning and cannot be restricted only to putting of concrete, grit, coal tar etc but it should mean everything relating to road. The expression such as “arising out of“ or “in respect of the” or “in connection with” or “in relation to” or “in consequence of” or “concerning” or “relating to” the contract are of the widest amplitude and content and include even questions as to the existence, validity and effect (scope). When both the appellate authorities have come to a definite finding of fact, then even otherwise, placing reliance on Rule 14 by the counsel for the Revenue, is not proper. What fraud has been played, counsel was unable to plead. - Decided against Revenue. Issues:1. Interpretation of exemption notification for works contract related to roads.2. Whether fixing safety barriers at a hazardous location on a national highway is part of a road construction contract.3. Application of Rule 14 of Sales Tax Rules regarding exemption withdrawal.4. Comparison with a judgment from Kerala High Court regarding road-related works contracts.Analysis:1. The case involved the interpretation of an exemption certificate granted for a works contract related to roads. The petitioner argued that the safety steel barriers fixed were not in accordance with the exemption notification, leading to the withdrawal of benefits. The respondent contended that the barriers were part of road construction, as found by lower authorities.2. The contract awarded for fixing safety barriers at a Toll Plaza on National Highway No.8 was scrutinized. The Assessing Officer initially withdrew the exemption benefits, stating the barriers could be used for purposes other than roads. However, both the Deputy Commissioner (Appeals) and the Tax Board concluded that the barriers were indeed related to road construction and safety measures, justifying the exemption fee.3. The petitioner relied on Rule 14 of the Sales Tax Rules, arguing that the exemption could be withdrawn if obtained through fraud or misrepresentation. The respondent countered this by highlighting that the exemption fee was leviable on all parts related to roads, as per the notification, making the fraud allegation baseless.4. A comparison was drawn with a judgment from the Kerala High Court regarding road-related works contracts. The court differentiated the facts of the Kerala case, emphasizing that fixing safety barriers on a national highway was an integral part of road construction, unlike the post-construction work in the Kerala case.In conclusion, the High Court ruled in favor of the respondent, stating that fixing safety barriers on the national highway was indeed related to road construction. This decision resolved the main controversy, rendering the other questions moot. The petition was dismissed, with no costs awarded.
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