TaxTMI 
TaxTMI 
2013 (7) TMI 492
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....d that of the First Appellate authority on the erroneous grounds which were neither raised not argued before it by the respondent herein? 2) Whether the Appellate Tribunal was justified in totally ignoring the definition of section 2(u) defining "works contract" to include designing, manufacturing, supplying, erection, installing, testingand commissioning of lifts/elevators as per the specifications of the each customer, wherein the parts are brought to the site of the customer and thereafter the contract is executed at the site of the customer resulting in agglomeration of the goods to the immovable property of the customer and not delivery as such of any finished goods to treat it as an outright "sale" under section 2(n) of the Act? 3) Whether the Appellate Tribunal committed an error in totally ignoring the finding of the assessing officer and the Appellate authority that the goods were manufactured at Gaziabad in the State of Uttar Pradesh pursuant to the order placed by the customer specifically earmarking the same with respect to the "Job-no", name and place of the ultimate customer even in the delivery challan and the lorry receipt which partakes the character of an inter-....
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....opy of the approved drawing will be sent to the factory at Ghaziabad for planning the manufacture of the spares of the lifts at Ghaziabad by duly mentioning the job number. The Branch Office will thereafter be duly intimated by the factory regarding the development of the production and the Branch Office will also be intimated about the completion of the project and the lifts will be dismantled and despatched from the factory directly to the customer site. On being informed so, the materials will be either taken delivery by customer or by their technical representative and thereafter, the technician will be sent from the Branch Office for erection of the lift at site. Thus, the modus operandi is that the goods will be manufactured at Ghaziabad factory according to the specifications given in the job order indicated by the customer by the Branch Office and thereafter, finished article will be despatched from Ghaziabad factory to the customer site, outside the state and be taken delivery by the customer and erected by the assessee's technician at customer's site. 3. Likewise, the assessee was placed with an order by customer for designing, manufacturing, supply, installation....
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....er's site for erection and invoices raised from the Ghaziabad factory mentioned the name of the ultimate buyer and exercise duty was charged by the Factory. The delivery invoice and L.R. also stated the consignee as Erection : Engineer ECE Industries Limited., C/o. Erode Kalvi Nilayam or Shanthi Hospital or Sirushri Constructions i.e. name of the ultimate buyer. As such there was a link or nexus between the work order received by the assessee from the customer within State of Tamil Nadu and the movement of goods originated from outside Tamil Nadu into Tamil Nadu for work at customer's site. As such, the transaction was interstate sale and hence the assessee is eligible for deduction under Section 3-B(2) of the Tamil Nadu General Sales Tax Act and accordingly, reversed the Assessing Officer's finding regarding the levy of tax and also penalty. 5. Aggrieved against the same, the Revenue preferred further appeal before the Tamil Nadu Sales Tax Appellate Tribunal. The Tribunal by relying on the decision of the Honourable Apex Court reported in 88 STC 204 GANNON DUNKERLY AND CO. AND OTHERS v. STATE OF RAJASTHAN AND OTHERS observed that the manufacturing activity was done at....
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....What the Branch Office did was to send technician for the purpose of installation and erection, testing and commissioning of the lifts in the customer's site. The Tribunal failed to see that the consignee name is mentioned as "ECE Industries Limited care of clients address" in the delivery invoice only to indicate that the same is meant for customer's site and not despatched to the Branch Office. As the sale is already effected and as the manufacture of the lift at Ghaziabad is only in pursuance of job order evidencing interstate sales, the question of further sale by branch office does not at all arise herein. The Tribunal has erroneously arrived at the conclusion that the goods were sent to the Branch Office at Tamil Nadu, and it is only the Branch Office, who in turn effected sale to the ultimate customer, thereby, treated the disputed transaction as pure and simple local sales. Thus, there is an error in the reasoning of the Tribunal resulting in rejecting the claim of the assessee. 8. Learned counsel for the assessee pointed out to the Division Bench judgment of the Karnataka High Court cited supra viz., 144 STC 605 STATE OF KARNATA AND OTHERS v. ECE INDUSTRIES LIMITE....