2009 (8) TMI 1083

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....ing officer accepted the petitioner's claim that the railways' order is a works contract. However, according to the officer it is not a civil contract falling under section 7(7) of the KGST Act. He has in fact permitted payment of tax at the compounded rate under section 7(7A) which provides for other contracts. In appeal filed by the petitioner, the first appellate authority as well as the Tribunal confirmed the assessment and hence this revision. We have heard counsel appearing for the petitioner and Government Pleader appearing for the respondents. During preliminary hearing, we wanted to know the exact nature of work done by the petitioner for the railways and in this regard we called for a copy of the purchase order/work ord....

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.... terms of the instruction given by the site engineer. Obviously the purpose is to replenish the deficiency in stone ballast on the railway track as part of maintenance work. However, the little technical work of laying the unloaded ballast in the required pattern to call it training out is the work probably done by the railways and it is not part of the work assigned to the petitioner. Therefore, the petitioner's claim that the work involves training out of the supplied stone ballast and so much so, it is maintenance of railway track which is a civil work falling under section 7(7) is unacceptable. We are of the view that the order is just a purchase order and the stacking is provided at a particular station to verify the actual quantit....

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....ew that training out is a works contract, a different view was taken in the later judgment whereunder the transaction was found to be sale of goods. We do not think we should express our opinion as to whether training out which is laying stone ballast on the railway track in a particular pattern is a works contract or not because in this case the question does not arise and we have already noticed that it is only a pure sale of goods and training out, if any, was done by the railway. However, it is to be seen from section 7(7) that Railway track maintenance is also treated as a civil work by the Legislature. Certainly the training out is a maintenance work of the railway track as it helps to retain the sleepers on the track and the railw....