TaxTMI 
TaxTMI 
2003 (1) TMI 670
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....l for the parties. 3.. The petitioner is a company registered under the Indian Companies Act, 1956. It had been awarded three civil works contracts as stated in paragraphs 4,5 and 6 to the writ petition. Photocopies of the works orders are annexures 2,3 and 4 to the writ petition. A perusal of the same shows that it involved civil work including earth work, development of the area, construction of road, walkways, landscaping, etc. Under section 2(h) of the U.P. Trade Tax Act, 1948 the transfer of property involved in the execution of a works contract is treated as sale. Under section 3-F of the Act tax is imposed on transfer of property in goods involved in execution of works contract. Section 3-F has been quoted in paragraph 8 of the wr....
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....al received from outside the State of U.P. to the extent of 5 per cent of the contract value, completely overlooks the provisions of section 7-D and this condition is contrary to the law laid down by the honourable apex Court and is also contrary to the object of section 7-D of U.P. Trade Tax Act which provides for levy of composition amount in lieu of the tax which is payable under the U.P. Trade Tax Act. 10.. In paragraph 27 of the writ petition it is stated that the petitioner has received goods from outside U.P. for executing the aforesaid works contract up to March 31, 2001 to the extent of approximately 35 per cent of the total contract value, whether it is by way of stock transfer or whether these are purchases/sales in the course....
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.... outside U.P. are above 5 per cent of the total contract money then the benefit of compounding will not be available above that amount was condition mentioned in the scheme of the State Government. It was for the petitioner either to opt for the scheme or not. In the proforma of the application an affidavit had to be filed under section 7-D. It is mentioned that the conditions and directions given by the State Government must be acceptable to the dealer. It is only when both the sides are agreeable that an agreement of composition can be entered into between the parties. Hence if the petitioner was not agreeable the petitioner should not have opted for composition and he could get himself assessed by way of regular assessment under the U.P.....
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....of section 7 is optional. The sub-sections expressly provide that the method of taxation provided thereunder is applicable only to a contractor who elects to be governed by the said alternate method of taxation. There is no compulsion upon any contractor to opt for the method of taxation provided by sub-section (7) or sub-section (7A). It is wholly within the choice and pleasure of the contractor. If he thinks it is beneficial for him to so opt, he will opt; otherwise, he will be governed by the normal method of taxation provided by section 5(1)(iv). Sub-section (8) provides that the option to come under sub-section (7) or (7A) has to be exercised by the contractor 'either by an express provision in the agreement for the contract or by an a....