TaxTMI 
TaxTMI 
2003 (9) TMI 718
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....th the State of Bihar No. 1-LCV/89-90. The petitioner completed the job and handed over the barrage to the State Government. The Assistant Commissioner, Commercial Taxes Department, Deoghar Circle, Deoghar, subsequently assessed the tax in the execution of "works contract" for the periods 1990-91, 1991-92 and 1992-93 and asked the petitioner to pay it. These orders issued by the Assistant Commissioner, Commercial Taxes Department, Deoghar Circle, Deoghar for three financial years have been challenged by the petitioner in three separate writ petitions. 2.. Counsel for the petitioner made following submission to challenge the orders and in support of petitioner's claim: (1) Transfer of property in goods is an essential ingr....
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.... of the present case, the position of the petitioner (contractor) is that of a bailee and/or trustee in respect of the goods supplied to it for using the same in the works contract, specially because the petitioner (contractor) never became the owner of those goods as those goods were never transferred. (6) Admittedly, the Government department has purchased iron, steel and cement material under section 13(1)(g) of the Bihar Finance Act, 1981 on payment of concessional sales tax for the purpose of Government use, as such the department cannot sell those materials. (7) Iron, steel and cement being taxable at one point of time, at the time of first sale, under the provisions of the Bihar Finance Act, 1981, the Government department bein....
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....rements for all preliminary and enabling work incidental to the works, will be supplied by the department as per stipulations in Schedule II. ............. (42) Sales tax: The rates quoted by the contractor shall be inclusive of 4 per cent sales tax which will be deducted from the bills. In case of any increase in sales tax during the period of contract, it will be paid by the department. The increase in sales tax will be allowed extra but deducted from the bills, contractor will not claim any refund on account of sales tax deducted from the bills. If, however, any refund is allowed after final assessment of the returns submitted by the contractor the same shall be credited to Government account." At Chapter IV of the agreement, sp....
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....rials used in the construction of the building by the contractor to the person who had assigned the contract and another part dealing with the supply of labour and services, sales tax was leviable on the goods which were agreed to be sold under the first part. But sales tax could not be levied when the contract in question was a single and indivisible works contract. After the 46th Amendment the works contract which was an indivisible one is by a legal fiction altered into a contract which is divisible into one for sale of goods and the other for supply of labour and services. After the 46th Amendment, it has become possible for the States to levy sales tax on the value of goods involved in a works contract in the same way in which the sale....