TaxTMI 
TaxTMI 
2011 (6) TMI 703
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.... the petitioner and Government Pleader appearing for the State. 2. The petitioner is a contractor engaged in the construction business in Kerala. During the year 2008-09, the petitioner purchased a Hitachi model JCB from Mangalore for Rs. 34,06,600 by availing of concessional rate of tax at two per cent against C form issued as provided under section 8(3) of the Central Sales Tax Act, hereinafter referred to as, "the Act". The Intelligence Officer of Sales Tax noticed that item purchased is not covered by the certificate of registration issued under the Act and so much so, the issue of C form is an offence punishable under section 10(b) of the Act, which calls for levy of penalty under section 10A of the Act. The petitioner raised the co....
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....gistered dealer can purchase from outside at concessional rate. The rule reads as follows: "13. Prescription of goods for certain purposes.-The goods referred to in clause (b) of sub-section (3) of section 8, which a registered dealer may purchase, shall be goods intended for use by him as raw materials, processing materials, machinery, plant, equipment, tools, stores, spare parts, accessories, fuel or lubricants, in the manufacture or processing of goods for sale, or in mining, or in the generation or distribution of electricity or any other form of power." 5. The CST Act originally provided concessional rate for purchase by traders for resale and by manufacturing and processing industries for production and sale of goods. However, p....
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....e of the above amendment, contractors are entitled to avail of concessional rate for inter-State purchase of goods which are for sale in the course of execution of works contract, whether as goods or in some other form. It is by virtue of this provision, the petitioner applied for registration under the Act which was in fact granted to him with an endorsement in the certificate of registration that the petitioner is entitled to make interState purchase of the following goods at concessional rate. "Cement, steel, sand, metal, construction tools, shuttering materials." 7. The petitioner's case is that the JCB purchased is a construction tool and so much so the item is covered by certificate of registration issued to him. However, ad....
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....lready explained above, the two categories of dealers originally covered under the Act are traders engaged in purchase and resale and industries engaged in the manufacturing and processing of goods for sale. After the constitutional amendment, a new class of dealers emerged who are deemed sellers of goods in the course of business like execution of works contract, leasing, hire-purchase, etc. A works contractor is engaged in purchase and resale of goods which happens in the execution of works contract. As is evident from section 2(g)(ii) itself, in the case of works contract, transfer of goods can happen in the same form or in some other form. This obviously means that contractors may engage in processing of goods for conversion of goods fr....
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.... much so, we declare that the inclusion of the item as a machinery or equipment through an amendment to the certificate of registration issued later is perfectly in order. However, we are unable to accept the contention of the petitioner that JCB is a tool which is already covered by the certificate issued earlier to him. "Tool" only means an instrument or implement used for work, whether manual or with machine. A large multiutility equipment like JCB cannot be termed as a tool as referred to in rule 13 of the CST Rules. We are, therefore, unable to accept the contention of the petitioner that prior to the amendment to the certificate of registration incorporating JCB also in it, the petitioner is entitled to purchase JCB at concessional ra....