1988 (8) TMI 381

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... original definition in section 2 of the Orissa Sales Tax Act, 1947 and the orders of assessment and demand notices relating to the assessment years 1984-85, 1985-86 and 1986-87 under the Orissa Sales Tax Act and rule 5 of the Orissa Additional Sales Tax Rules as per annexures-1 and 1/A in each of the writ applications. 2.. The petitioner-company claimed to have the expertise and necessary machinery, equipments and technical know-how for drilling oil wells on high seas. For carrying out the operation and rendering services it had a drilling rig called "AZTECA" complete with drilling and other equipments. Messrs. Oil India desired to have off-shore wells drilled on the Mahanadi basin with a view to exploring hydrocarbons. It entered into ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....s Tax Rules and raised demands and levied penalty as per annexures-1 and 1/A in each of the writ applications. 3.. To get over the rule laid down in Gannon Dunkerley's case [1958] 9 STC 353 (SC); AIR 1958 SC 560, article 366 of the Constitution of India was amended by the Forty-sixth Amendment Act, 1982. Clause (29A) was inserted. So far as relevant for our purpose, it read:   "'Tax on the sale or purchase of goods' includes- (a).................... (b)..................... (c)..................... (d) a tax on the transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; (e).................... (f)......................

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....rd to entry 54 of List II of the Constitution. The field of legislation having been delineated by clause (29A)(d) of article 366 and sub-clause (iv) of clause (g) of section 2 of the Act being verbatim reproduction of subclause (d) of clause (29A) of article 366, there is no substance in the challenge that the State Legislature did not have the competence to enact the provision.   6.. The next contention relates to the legality and vires of the assessment. It is submitted that there was no sale inside the State. The operations were carried on on high seas. There was no transfer of goods. The services rendered by the petitioner did not come even within the definition of "sale" in section 2(g)(iv). There was no transfer of the right t....