TaxTMI 
TaxTMI 
2011 (3) TMI 1506
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....ort, "the ONGC"), for the work well logging, perforating and other wireline services for its oil and natural gas exploration and exploitation to be carried out on land in the States of Gujarat, Tamil Nadu, Andhra Pradesh, Pondicherry, Madhya Pradesh, Rajasthan, Assam, Nagaland, Tripura, etc., under the jurisdiction of the Union of India, the petitioner submitted its tender for obtaining the work. In course of time, the contract was awarded and an agreement was entered into, in this regard, on September 5, 2003, the period of contract, in question, being for a period of three years from January 28, 2002 to January 27, 2005 for the central region. The petitioner raised his bills for payment from time to time. By letter, dated 18/20th December, 2004, respondent No. 3, namely, Superintendent of Taxes, Government of Tripura, Charge No. V, Agartala, informed respondent No. 4 that respondent No. 4, namely, Oil and Natural Gas Corporation Ltd., AD Nagar, West Tripura, Agartala, ought to have realized by making deduction, at source, of sales tax at four per cent from the petitioner's bills as sales tax since August, 2001, treating the said contract as contract constituting transfer of right....
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....h Amendment) Act, 1982, the word "sale", which occurred in the expression "sale of goods", in the Seventh Schedule to the Constitution of India, had carried the same meaning as a "sale" defined in section 4 of the Sale of Goods Act, 1930. Hence, prior to the 46th Amendment, "sales tax" could be imposed only upon transfer of property in goods from one person to the other. Thus, "sales tax" could not be imposed upon transactions, which might have resembled "sale", but did not involve transfer of property in goods. Consequently, prior to the 46th Amendment of the Constitution, because of various judicial decisions, States were losing revenue on account of "sales tax" in respect of transactions like transfer of the right to use goods, transfer of property in goods involved in execution of "works contract", supply of food by a hotelier, etc. As back as in the year 1967, the Madras High Court, in A.V. Meiyappan v. Commissioner of Commercial Taxes [1967] 20 STC 115 (Mad), turned down the contention of the sales tax authorities by holding that even if copy-right is regarded as a specie of movable property, the transaction did not connote a "sale" at all and it was, therefore, not exigible....
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....s for any purpose and for any period, for cash, deferred payment or other valuable consideration, shall be deemed to be a sale of goods by the person making the transfer, delivery or supply, and a purchase of those goods by the person to whom transfer, delivery or supply is made. The Constitution (46th Amendment) Act, 1982, also added sub-clause (b) to clause (3) of article 286. Consequent upon these amendments of the Constitution, almost all the States amended the definition of the word "sale" by incorporating, in their respective sales tax legislations, identical language used by the Constitution, for the purpose of defining "sale". Indisputably, the expression "transfer of the right to use any goods" cannot be equated with the expression "transfer of property in goods", because the transfer of the "right to use any goods" is not the same thing as the "transfer of property in the goods". But according to the definition of "sale", as amended by the State legislations, a "sale" means "transfer of property in goods" and such a "sale" includes, inter alia, "any transfer of the right to use any goods". The power of State Legislatures to enact law to levy tax on the "transfer of right....
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.... export, as "sales within the State" for, it is within the exclusive domain of the appropriate Legislature, i.e. Parliament, alone to fix the location of sales by creating legal fiction or otherwise. The Constitution Bench of the Supreme Court in 20th Century Finance Corporation Ltd. v. State of Maharashtra [2000] 119 STC 182 (SC); [2000] 6 SCC 12, while examining the question as to where the situs of a "sale" would be, observed that the location or delivery of goods, within a State, cannot be made by the State a basis for levy of tax on sales of goods and merely because the goods are located or delivery of goods has been effected for use within a State cannot be made by the State the situs of deemed sale for levy of tax if the transfer of right to use has taken place in another State. The relevant observations, appearing, in this regard, in 20th Century Finance Corporation Ltd. [2000] 119 STC 182 (SC); [2000] 6 SCC 12, read as under: "We, therefore, find that the location or delivery of goods within the State cannot be made a basis for levy of tax on sales of goods. Under general law, merely because the goods are located or delivery of which has been effected for use within the ....
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....oods are when the right to use them is transferred is of no relevance to the locus of the deemed sale. Also of no relevance to the deemed sale is where the goods are delivered for use pursuant to the transfer of the right to use them, though it may be that in the case of an oral or implied transfer of the right to use goods, it is effected by the delivery of the goods." What follows from the above observations made, and conclusions arrived at, in 20th Century Finance Corporation Ltd. [2000] 119 STC 182 (SC); [2000] 6 SCC 12, is that the taxable event, in a contract of transfer of the right to use goods, arises, when the right to use goods stands transferred, no matter where the place of delivery is. To put it a little differently, it is the transfer, which is sine qua non for the taxable liability to arise out of a contract to transfer the right to use any goods. "If the goods are available", the transfer of the right to use the goods takes place, when the contract, in respect thereof, is executed. In such a case, as soon as a contract, in writing, is executed, the right vests in the lessee. Thus, the situs of taxable event of such a "sale" would be the transfer, which legally tra....
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.... the petitioners. Relying on the definition of "dealer" as given in section 2(b) of the Tripura Sales Tax Act, 1976 (hereinafter referred to as the, "TST Act") and the definition of "sale" as given in section 2(g) thereof, Mr. Somik Deb, learned counsel, appearing for the petitioners, contends that section 2(g) of the TST Act seeks to expand the horizon of "sale" without embracing such categories of persons, who deal in "deemed sale" of goods by way of hire-purchase and "deemed sale" of goods by way of transfer of right to use any goods. It is also submitted by Mr. Deb that from a bare reading of section 2(b) of the TST Act, it is crystal clear that no person, making delivery of goods on hirepurchase, or a person, making a transfer of right to use any goods, for any purpose, can be termed as "dealer". Mr. Deb has further submitted that since section 3(1) of the TST Act provides that only a "dealer", dealing in taxable goods, is liable to pay tax, the definition of "sale", as given in section 2(g) of the TST Act, is unconstitutional, for, the definition of "sale" seeks to embrace, within its ambit, the transactions, such as, transfer of right to use any goods for any purpose, though....
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....r Pradesh v. Union of India [2003] 130 STC 1 (SC); [2003] 3 SCC 239 and Goa Carbon Ltd. v. Commissioner of Trade Tax [2008] 13 VST 456 (SC); [2008] 11 SCC 176. Resisting the writ petitions, Mr. N. Adhikari, learned Advocate-General, Tripura, has submitted that the definition of "sale", as given in the TST Act, 1976, as well as the TVAT Act, 2004, do not embrace, within its ambit, a "sale", actual or deemed, if the "sale" does not take place within the State of Tripura and the entire submissions, made, this regard, on behalf of the petitioners, have no merit inasmuch as the assessing authorities, while making assessment, cannot include, under the provisions of the said two enactments, any transaction of "sale", actual or deemed, which does not take place within the State of Tripura. Before we deal with the rival contentions of the learned counsel for the parties, it would be appropriate to have a look at the relevant provisions of the TST Act and the TVAT Act. Section 2(b) of the TST Act, 1976, defines "dealer" as under: "'dealer' means any person who sells taxable goods manufactured, made or processed by him in Tripura or brought by him into Tripura from any place outside Tripur....
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....f any tax payable under this Act on the sales of any taxable goods to such person or class of persons as may be prescribed. (4) Where exemption from the levy of tax under this Act on any sale of taxable goods is claimed by a dealer under the provisions of this section the burden of proof shall lie on such dealer and the Commissioner may require the dealer to substantiate the claim in manner prescribed. (5) If any dispute or question regarding payment of tax arises, the matter shall be referred to the Commissioner whose decision thereon shall be final." From a bare reading of section 3 of the TST Act, it becomes clear that the liability to pay tax is on the "dealer" dealing in taxable goods and he is liable to pay tax on the "turnover" at the rate specified in the third column of the Schedule attached to the Act. The term "turnover" has been defined by section 2(m) to mean as under: "'turnover' means the aggregate of the amount of sale price receivable or if a 'dealer' so elects actually received by the 'dealer' in respect of any sale of goods made during any prescribed period in any year after deducting- (i) the amount of sale price, if any, refunded by the 'dealer' to a purch....
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.... This, in turn, shows that if a person purchases taxable goods in the State of Tripura and sells the same within the State of Tripura, he does not become a "dealer" and on such a "sale", no sales tax can be imposed by invoking the provisions of section 3. What is, now, necessary to note is that by amendment, which Tripura Sales Tax (Third Amendment) Act, 1984, has introduced, a person, making a sale under section 3A, has been included within the meaning of the expression "dealer". Section 3A is meant for a person, who executes a "works contract", for, in the execution of "works contract", whatever goods are used by him either as goods or in some other form, such utilization of goods would, by legal fiction, be "deemed" to be a "sale" of those goods used in execution of the "works contract". A minute scrutiny of clause (b) of section 2 of the TST Act, 1976, clearly reveals that by fiction of law, while a person, who executes a "works contract", has been made and shall be treated as a "dealer", a person, who makes "transfer of the right to use any goods for any purpose as well as a person making delivery of the goods on hire-purchase" have not been included within the definition of....
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....ngaged in the business of delivery of goods on hire-purchase or any other system of payment by instalments as well as a person, who carries on the business of buying, selling, supplying for commission, remuneration or other valuable consideration, and includes- (a) an industrial, commercial, banking, or trading undertaking whether or not of the Central Government or any of the State Governments or a local authority; (b) an advertising concern or agency; (c) a casual trader; (d) a company, firm, club, association, society, trust, or co-operative society, whether incorporated or un-incorporated, which carries on such business; (e) a commission agent, a broker, a del credere agent, any auctioneer or any other mercantile agent by whatever name called, who carries on the business of buying, selling, supplying or distributing goods on behalf of any principal; (f) an agent of a non-resident "dealer" or a local branch of a firm or company or association situated outside the State; (g) a person who sells goods produced by him by manufacture or agriculture or otherwise; (h) a person engaged in the business of transfer otherwise than in pursuance of a contract of property in an....
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....ere to point out that Mr. Deb, learned counsel for the petitioners, submits that since the TST Act, 1976, has not created any charge in so far as it relates to transfer of right to use any goods, the question of deduction of tax, at source, in respect of payment made for transfer of right to use any goods does not arise. It was submitted that the term "dealer", as defined in the Act, does not include a person carrying the business of transfer of right to use any goods. Even the definition of "sale price", given in section 2(h), does not include the consideration for transfer of right to use any goods. It was further submitted that the subordinate legislation can be framed in conformity of the provisions contained in the parent Act and the same cannot supersede the mandate contained in the Act. No subordinate legislation can be framed, contended Mr. Deb, unless there is a provision enacted by the Legislature enabling making of subordinate legislation. No charge having been made on account of transfer of right to use any goods, submitted Mr. Deb, the provisions of rule 3A(2) of the Tripura Sales Tax Rules, 1976, providing for deduction of tax, at source, at the flat rate of four per ....
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....igatory for a person, responsible for making payment of any sum to any person, who is liable to pay sales tax under section 3A, to deduct, at the time of credit of such sum, to the account of the person or at the time of payment thereof in cash or by issue of a cheque or draft or any other mode, such amount towards sales tax as may be prescribed. (20) Thus, section 3AA permits deduction, at source, only in respect of transfer of property in goods involved in the execution of works contract and not in respect of transfer of the right to use any goods for any purpose. This apart, from the fact that the TST Act does not create charge, on any person, who transfers his right to use any goods for any purpose, section 3AA cannot be invoked for the purpose of deducting, at source, any amount as sales tax. Otherwise also, it would be impossible to hold that deduction, at source, as sales tax, is permissible out of the bills of a person, who gives, on hire, vehicle(s) for any purpose, when no liability to pay sales tax has been imposed on such a person by section 3, which is, admittedly, the charging section. (21) We, now, turn to rule 3A(2), which we find reads as under: 'Rule 3A(2). Ever....
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....ates by which and the authority to which returns shall be furnished; (f) the manner in which refunds shall be made; (g) the fees if any, for petitions, certificates and other matters; (h) the nature of accounts to be maintained by a dealer; and (i) for any other matter necessary for giving effect to the purpose of this Act. (3) Every rule made by the State Government under this Act shall be laid as soon as may be after it is made, before the legislative assembly while it is in session for a total period of not less than fourteen days which may be comprised in one session or in two or more successive sessions and if, before the expiry of the session in which it is so laid or the successive session aforesaid the legislative assembly agree in making any modification in the rule or the legislative assembly agree that the rule should not be made, the rule shall thereafter have effect only in such modified form or be of no effect as the case may be, so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule.' (24) It is, no doubt, true that sub-section (1) of section 44 gives a general power to the Sta....
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....ht within the scope of the statute by the Legislature. (27) It is very common for the Legislature to provide for a general rule-making power to carry out the purpose of an enactment. When such a power is given, it may be permissible to find out the object of an enactment and, then, ascertain, if the rules framed, satisfy the test of having been so framed as to fall within the scope of such general power. In the present case, though the State Government has been vested with the general rule-making power to carry out the purpose of the TST Act, the fact remains that such a piece of delegated power cannot be used to bring, within the tax net, a subject, which the enactment has kept excluded, or to bring into existence any substantive obligation, which the provisions of the enactment do not contemplate. (See Kunj Behari Lal Butail v. State of H.P. reported in [2000] 3 SCC 40). (28) It is trite that if, in a fiscal legislation, the person, sought to be taxed, does not fall within the letter of the law, he cannot be taxed even if the spirit of the law may appear to include him. More than a century ago, Lord Cairns, in Partington v. Attorney-General reported in [1869] LR 4 (HL) 100, obs....
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.... Tax Act, 1963, held that a charge under a taxing statute can only be under the statute and not even under the rules ; hence, the deduction, at source, by executive instructions, such as, the impugned memorandum, cannot be treated as a valid piece of executive instruction. (32) An attempt was also made by Mr. S. Deb, learned senior counsel, to persuade the court to hold rule 3A(2) as intra vires by referring to the decision in Ajay Canu v. Union of India reported in [1988] 4 SCC 156. While considering the case of Ajay Canu [1988] 4 SCC 156, what needs to be pointed out is that the question, which arose for determination in Ajay Canu's case [1988] 4 SCC 156, was as to whether wearing of crash-helmet by the drivers of two wheelers can be made compulsory by framing rule under clause (i) of sub-section (2) of section 91 of the Motor Vehicles Act, 1939. At the relevant point of time, sub-section (1) of section 91 and clause (i) of subsection (2) of section 91 read as under: '91(1) The State Government may make rules for the purpose of carrying into effect the provisions of this Chapter. (2) Without prejudice to the generality of the foregoing power, such rules may provide for-....
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....3. (35) What crystallizes from the above discussion is that unless the TST Act is suitably amended by either expanding the definition of 'dealer' or by making appropriate changes in the provisions of section 3, which is the charging section, no person, who transfers the right to use any goods for any purpose, can be held liable to pay sales tax under the TST Act. What also crystallizes from the above discussion is that rule 3A(2) is, in the light of the discussion held above, ultra vires the TST Act. (36) In the result and for the reasons discussed above, while the appeals, preferred by the State Government, fail and the same shall accordingly stand dismissed, the appeals, preferred by the writ petitioners, are hereby allowed. (37) In view of the fact that rule 3A(2) has been held to be ultra vires, no authority vests in the Department of Revenue, Government of Tripura, to either direct payment of, or deduction at source for the purpose of payment of sales tax from the bills of any person, who transfers the right to use any goods for any purpose." Before we proceed to answer the issue as to whether the contract of well-logging, perforating and other wireline services, to be car....
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...., no sooner the contract is executed. The Supreme Court further observed, in 20th Century Finance Corporation Ltd. [2000] 119 STC 182 (SC); [2000] 6 SCC 12, that if the goods are available, irrespective of the fact as to where the goods are located, and a written contract is entered into between the parties, the taxable event, on such a "deemed sale", would be the execution of the contract; but in the case of an oral or implied transfer of the right to use goods, such a transfer may be effected by the delivery of the goods. Having so observed, the Supreme Court, in 20th Century Finance Corporation Ltd. [2000] 119 STC 182 (SC); [2000] 6 SCC 12, pointed out that no authority could be shown to support the view that there would be no completed transfer of right to use goods unless the goods are delivered. The Supreme Court, therefore, concluded, in 20th Century Finance Corporation Ltd. [2000] 119 STC 182 (SC); [2000] 6 SCC 12, that delivery of goods cannot constitute a basis for levy of tax on the transfer of the right to use any goods. The relevant observations made, on the above aspects of the law, in 20th Century Finance Corporation Ltd. [2000] 119 STC 182 (SC); [2000] 6 SCC 12, re....
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....f the right to use goods. However, Bharat Sanchar Nigam Ltd. v. Union of India reported in [2006] 3 VST 95 (SC); [2006] 145 STC 91 (SC); [2006] 3 SCC 1, a threeJudge Bench had the occasion to consider the question as to whether delivery of goods is at all necessary for the purpose of effecting the transfer of the right to use the goods and if so, when. To the question so clearly posed, the Supreme Court responded by holding that the essence of the right, under article 366(29A)(d), is that it relates to user of goods and though, in a given case, actual delivery of the goods may not be necessary for effecting transfer of the right to use the goods, yet the goods must be available at the time of the transfer, must be deliverable and delivered at some stage. The Supreme Court pointed out, in Bharat Sanchar Nigam Ltd. [2006] 3 VST 95 (SC); [2006] 145 STC 91 (SC); [2006] 3 SCC 1, that the decision, in 20th Century Finance Corporation Ltd. [2000] 119 STC 182 (SC); [2000] 6 SCC 12, cannot be cited as an authority for the proposition that delivery of possession of goods is not a necessary concomitant for completing a transaction of sale for the purpose of bringing such a transaction within....
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....006] 145 STC 91 (SC); [2006] 3 SCC 1, until the time the delivery of the goods takes place, for, it is upon delivery of the goods that the transfer of the right to use the goods is completed. This delivery may, however, be actual or constructive. In other words, a "deemed sale" cannot be treated as complete until the time the contract is executed by delivery, actual or constructive, of the goods inasmuch as the transfer of the right to use goods does not take place until the time the transferor delivers, actually or constructively, the goods, which form the subject of contract, though, for the purpose of determining the situs of such a "deemed sale", it is the place, where the agreement is executed, which will be treated as the place of the "deemed sale" provided that the agreement is in writing ; but in a case of oral agreement, it may be effected by the delivery of the goods. The relevant observations made, in this regard, in Bharat Sanchar Nigam Ltd. [2006] 3 VST 95 (SC); [2006] 145 STC 91 (SC); [2006] 3 SCC 1 read as under (pages 126 and 127 in 3 VST): "With respect, the decision in 20th Century Finance Corporation Ltd. v. State of Maharashtra [2000] 119 STC 182 (SC); [2000] 6....
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....he goods, but the goods must be in existence, "deliverable", when the right is sought to be transferred, and must, at some stage, be delivered. It is, therefore, clear that in order to constitute a transfer of right to use goods, there must be, either actually or constructively, parting with the possession of the goods for the limited period of its use in favour of the lessee by the lessor. The effective control of the goods must not remain with the owner, but must stand transferred to the lessee for the use by the latter at his will and it is this transfer of the effective control of the goods, which attracts sales tax (See also Alpha Clays v. State of Kerala reported in [2004] 135 STC 107 (Ker). In State of Andhra Pradesh v. Rashtriya Ispat Nigam Ltd. reported in [2002] 126 STC 114 (SC); [2002] 3 SCC 314 it was claimed by the sales tax authorities that the transaction, whereby the owner of certain machinery had made available his machinery to the contractor, amounted to sale. Dealing with this contention of the sales tax authorities, a Division Bench of the Andhra Pradesh High Court held that the transfer of the right to use goods necessarily involves delivery of possession by....
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.... read as under (page 128 in 3 VST): ". . .when the assessee had hired shuttering in favour of contractors to use it in the course of construction of buildings it was found that possession of the shuttering materials was transferred by the assessee to the customers for their use and, therefore, there was a deemed sale within the meaning of sub-clause (d) of clause (29A) of article 366. What is noteworthy is that in both the cases there were goods in existence which were delivered to the contractors for their use. In one case there was no intention to transfer the right to use while in the other there was." Apart from the above, it is also necessary to note that all the sub-clauses of article 366(29A) serve to bring transactions, where one or more of the essential ingredients of a "sale" as defined in the Sale of Goods Act, 1930, are absent, within the ambit of purchase and sale for the purposes of levy of sales tax. To this extent only is the principle enunciated in Gannon Dunkerley & Co. (Madras) Ltd. [1958] 9 STC 353 (SC). The amendment especially allows specific composite contracts, viz., "works contract's (subclause (b)); hire-purchase contracts (subclause (c)), catering cont....
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....o whether the contract, in the present case, is a contract for transfer of right to use goods. The question whether there is transfer of the right to use any goods or not becomes, in every given case, a question of fact and this fact can be determined, on the basis of the terms of the contract, which may govern a given transaction. In fact, in North East Gases Pvt. Ltd. v. State of Assam reported in [2004] 134 STC 249 (Gauhati), this court has held that the question relating to transfer of the right to use any goods is essentially a question of fact, which has to be determined, in each case, having regard to the terms of the contract, wherein the transfer is made. In view of the fact that the terms of the contract really determine whether, in a given case, there is or there is no transfer of the right to use any goods, it is necessary, in the present case, to take note of the relevant clauses of the agreement, which govern the transaction, which is sought to be made exigible to sales tax. The relevant portions of the agreement, in question, are, therefore, reproduced hereinbelow: "Whereas the corporation is desirous of engaging a contractor for providing well-logging, perforatin....
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....oyed or damaged during operation under the circumstances described in article 15.1.1 will be made in accordance with the provisions under article 15.0 (m) Reimbursement of equipment transportation expenses will be made in accordance with the provision of article 6.5. 5.2 Corporation's Representative The duties of the corporation's representative are to act on behalf of the corporation for overall coordination and project management at site. The corporation's representative shall have the authority to change the orders in the scope of work to the extent so authorized and notified by the corporation to the contractor in writing. The corporation's representative shall liaise with the contractor; monitor the progress so as to ensure the timely completion of the works. 5.3 Engineer The engineer shall ensure that the works are carried out in accordance with the specifications, drawings and other terms and conditions of the contract. The engineer shall have the right to inspect at all reasonable times any part of the works and necessary tests to be carried out to reject such works which is not in accordance with the contract. The engineer has the right to scrutinize the records for t....
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....itation. (g) Contractor shall be responsible for and shall provide at its expenses unless otherwise provided in the contract, maintenance of equipment and spares, etc., and handle fuel and lubricants for the equipment. 19.0 Insurance and indemnity insurance The contractor shall arrange comprehensive insurance to cover all risks assumed by contractor under this contract, in respect of its personnel deputed to work under this contract as well as the logging units, tools, equipments, materials and any other belongings of the contractor or their personnel during the entire period of their engagement in connection with this contract. The corporation shall have no liability in this regards whatsoever, except for the tools/equipment and other accessories lost/damaged inside the wells as mentioned in clause 15.0. 22.1 Independent contractor The contractor is an independent contractor performing services as requested by corporation. Corporation is at all times in full care, custody and control of the well. Corporation shall have a responsible representative present to furnish full and adequate instructions relating to the service or services to be performed and corporation's represent....
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....oduction procedures, and all other activities relating to the drilling or production operations, including the abandoned thereof. 22.7 Pollution or contamination Notwithstanding anything to the contrary contained herein, it is understood and agreed by and between the contractor and corporation that the responsibility for pollution or contamination shall be as follows: (a) The contractor shall assume all responsibility for cleaning up and controlling pollution or contamination, which originates with contractor's equipments and facilities above the surface. (b) Corporation shall assume all responsibility for (including control and removal of the pollutant involved) and shall protect, defend and save the contractor harmless from and against all claims, demands and causes of action of every kind and character arising from all pollution. 25.0 Accidents All expenses incurred including, but not limited to procurement of spares down time, etc., in respect of repairs arising out of damages caused by gross negligence of the contractor shall be borne exclusively by the contractor. No liability on this account shall accrue to the corporation under any circumstances. However, any reimburs....
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....ration, for overall coordination and the project management at the site. Similarly, the duty of the engineer is to ensure that works of "well-logging, perforating and other wireline services" are in accordance with the specification, drawing and other terms and conditions of the contract. Clause 7.0 clearly provides that the contractor has to maintain its equipment in sound, safe and efficient condition throughout the duration of the contract. The contractor has to also pay all wages and salaries to the personnel deployed for the performance of the services under the contract and the ONGC shall have the full right, for good cause, to request the removal of any of the personnel of the contractor for incompetency, unreliability, misbehaviour, etc., "on or off the job". The contractor is also required to provide for the maintenance of equipment and spare parts and handling fuel and lubricants for the equipment. Clause 11.1 will clearly shows that the contract is for the performance of the work and the actual performance and superintendence of all operations shall be by the contractor. As per clause 11.2, the contractor has to comply with all safety and labour laws of the area of opera....
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....missions or licences required therefor should be available to the transferee; (d) for the period during which the transferee has such legal right, it has to be the exclusion to the transferor-this is the necessary concomitant of the plain language of the statute, viz., a 'transfer of the right to use' and not merely a licence to use the goods; (e) having transferred the right to use the goods during the period for which it is to be transferred, the owner cannot again transfer the same rights to others." As has been envisioned in paragraph 97 of Bharat Sanchar Nigam Ltd. [2006] 3 VST 95 (SC); [2006] 145 STC 91 (SC); [2006] 3 SCC 1, the essential features of "sale" amongst others are (1) the legal right of the transferee to use the goods to the exclusion of the transferor during the period of the contract and not merely as a licensee therefor and (2) the legal right of the transferee to use the goods with all legal consequences thereof including permission or licence to be available to permit the exercise thereof. In the present case, the terms and conditions, embodied in the contract agreement, when read as whole, do not proclaim possession, custody and control of equipment to t....
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....plated by article 366(29A)(d) of the Constitution of India or section 2(27)/2(43) of the Act. A dominion of the corporation over the manned crane(s) though perceptible for the operational needs the over-whelmingly emphatic covenants consciously incorporated by the contracting parties emphasise as well the singular responsibility and accountability of the contractors to unfailingly guarantee the timely placement, and availability of the manned crane(s) as well as the smooth and quality execution of the works. A few clauses of the contract though are suggestive of the corporation's prerogative to use the crane(s) as per its requirements, the same per se do not constitute cessation of the contractors' duties as enumerated on various fronts for due discharge of the services expected of them. The terms and conditions of the contract agreements taken as a whole, do not proclaim corporation's possession, custody and control of the crane(s) to the total exclusion and estrangement of the contractors wholly alienating them from the assignment agreed to be undertaken. The parties seem to be ad idem to accentuate upon continuous supervision and surveillance of the contractors not only to affir....