2014 (5) TMI 136

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.... of duty chargeable from the respondent-assessee on the execution of the contracts for supply and fixing of metal crash barriers. The assessee contends that the rate of duty prescribed is 2% as against which the Department contends that the same would attract 12% duty. The two entries contained in Schedule II-A relied upon by both the sides read as under : Sr. No. Description of works contract Rate of Composition 1. Works contract for civil works like Construction of buildings, bridges or roads, and repairs thereof 2% 2. Works contracts for other than those mentioned above and for repairs thereof 12%   4. From the materials on record, it emerges that the respondent-assessee had undertaken a contract for preparing and install....

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.... other premises or even to a railway track. Thus, admittedly, the use of the crash barrier is limited to the roads only. It can be seen that the applicant was engaged in the contracts of supply and fixing crash barriers on highways. He was to work as sub-contractor of M/s.Dodsal Pvt. Ltd. on the project of Surat Manor Tallway Project. The applicant was also to work as sub-contractor of M/s .Backbone Projects Limited and was to supply and fix metal beam crash barriers on Chiloda Himatnagar project. It can be seen that the applicant was to work on highways projects, where normally the crash barriers are to be fixed. The permission to pay composite tax was granted only relating to those works Contract. Admittedly, such composite tax has to be....

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.... shows that the road side metal crash barriers are an integral part of the road and therefore, in the view of this Tribunal, the supply and fixing of metal crash barrier amounts to civil works and therefore, the applicant was liable to pay composite tax @ of 2%. The argument of the learned Government Agent that the applicant was not constructing the roads, cannot be accepted in view of the above discussion. It cannot be said that the work of the applicant was not a civil work. The learned GA submitted that the work which the applicant was doing was exclusively of the iron or metal and there was some percentage of cement concrete work. Be that as it may a contractor cannot be allowed to complete a highway, unless he fixes the road side barr....

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....t of Highway or road. However, the work of installation and fixing of Anti Crash Road Beam or Barriers" requires substantial work of concrete. In other words, the installation and fixing of any kind of beams and barriers on roads is, basically a civil works of building which forms part of road on completion. Thus, the work undertaken by the sub-contractor is civil work for road which becomes integral part of the road. Support can be derived from the decision of the Hon.Andhra Pradesh High Court in the case of Larsen & Tourbo Ltd v. State of Andhra Pradesh [2006] 148 STC 616 (AP) wherein it is held that in a transaction of works contract, the property in goods passes directly to the contractee by the theory of accretion. In the event of cont....