1999 (12) TMI 846

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....red by P. VENKATARAMA REDDI, J.-The petitioner questions the action of the respondents Nos. 1 and 2 in effecting recovery towards sales tax at 4 per cent from the bills payable to the petitioner in connection with the works contract entrusted to him through agreement No. 15/SE. III/1997-98. The petitioner submits that such deduction under section 5-H of the Andhra Pradesh General Sales Tax Act,....

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....dhra Pradesh Act No. VI of 1957), the Governor of Andhra Pradesh hereby exempts with effect from April 1, 1976 from the tax payable under the said Act on the sales and purchases of goods by the Tirumala Tirupathi Devasthanams." 4.. A perusal of the Government order makes it clear that the works contractor who transfers or utilises the material in the course of execution of contract is not entit....

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.... tax. Obviously, this circular proceeds on a wrong assumption. It is not as if the purchases by T.T.D. are liable to be taxed under the Act in the case of works contract unless the goods in question are taxable at purchase point. The goods taxable at sale point are liable to be taxed in the hands of the contractor and that is why the deduction is required to be made. As far as the sale by the c....

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....of T.T.D. Thus, we cannot give effect to the circular issued by the Chief Engineer, T.T.D., which is based on a wrong assumption of the legal position as to the scope of the exemption notification. It is axiomatic that the circular itself which is in the nature of executive instructions cannot go beyond the scope of the provisions of the Act. The T.T.D. is legally liable, as the provisions now sta....