TaxTMI 
TaxTMI 
2015 (1) TMI 855
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....facts of the case are that vide notification No.898 : F.4(7)FDGr.IV/92-14 dated 30.04.1993 issued in the exercise of powers conferred by the extant Section 4(2) of the Act of 1954 read with Rule 10B of the then operating Rajasthan Sales Tax Rules, 1955, the State Government exempted from tax the transfer of property in goods (whether as goods or in some other form) involved in the execution of works contracts relating to buildings, bridges, dams, roads and canals on the following conditions : 1. That the contractor undertakes to pay exemption fee @ 1% on the total value of such contract ; 2. That the contractor holds a valid certificate of exemption for such contract; 3. That such contract is awarded (date of dispatch of acceptance of the contract) after the date of publication of this notification in the Official Gazette; 4. That the contractor shall not be entitled to use declaration forms to purchase goods without paying tax or paying tax at concessional rate of tax, for being used in the execution of such contract ; and 5. That if the contractor uses declaration forms in purchasing any goods in violation of condition No.4, apart from paying exemption fee under th....
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.... "tax" to mean "any tax or other levy by any name, leviable under the provisions of the Act." Also relying upon the judgment of this Court in the case of M/s. Murlidhar Deendayal, Ajmer Vs. Commercial Taxes Officers, Special Circle, Ajmer [(2002) 1 RTR] 59 decided on 07.02.2002 the appellate authority held that surcharge on amounts paid as condition of exemption from payment of tax under Section 4(2) of the then extant Act of 1954 was not leviable. The assessing authority's order to the contrary issued on 13.07.2001 was thus set aside. Aggrieved of the appellate order dated 25.11.2005, the petitioner-Department (hereinafter 'the Department') filed a further appeal under Section 85 of the Act of 1994 before the Tax Board. That appeal has been dismissed by the Tax Board vide order dated 30.06.2008. Hence this revision by the Department under Section 86 of the Act of 1994. The Advocates of this Court are on a strike. Mr. Jhala appears for the Department. None appears for the assessee. This Court in the case of CTO Vs. M/s Murlidhar Deendayal, SBSTR No. 69/2004 decided on 12.04.2006, has held that surcharge on payment of 1% amount of a works contract executed for purp....
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.... held that surcharge where provided for in an Act is thus a mere super added charge. Dealing with the word "surcharge" under the Kerala Electricity Surcharge (Levy and Collection) Act, 1989, the Hon'ble Apex Court held that surcharge under the said Act was an enhanced levy only. Reference was made by the Apex Court to its own judgment in the case of The Commissioner of Income Tax, Kerala Vs. K. Srinivasan [(1972) 4 SCC 526] wherein, dealing with the question whether the term "income tax" as defined under Section 2 of the Finance Act, 1963 would include surcharge and additional surcharge whenever provided, the Hon'ble Apex Court had held that the word "surcharge" included additional tax and the whole proceeds of any surcharge were to form part of the revenue of the State. The Hon'ble Supreme Court also approved C.V. Rajagopalachariar Vs. State of Madras [AIR 1960 Mad. 543] where the Hon'ble Madras High Court held, in the context of the Madras Land Revenue Surcharge Act, 1954 and the Madras Land Revenue (Additional Surcharge) Act, 1955 that surcharge only entailed an excess or additional burden or the amount of tax otherwise charged towards land revenue. It is thus....
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.... dated 30.04.1993 was in the nature of a fee. Under the obtaining state of law, it cannot be so held even though the exemption notification does indeed refer to the payment of 1% of the work contract value as an "exemption fee". Fee is a concept well known in law and has is own legal connotation. It would be desirable to note that nothing turns on the mere use of the word "fee" in a statute rule / circular / or notification. The nature and character of the impost is to be determined to conclude whether the charge is a fee or not. In Indian Mica Micanite Industries Vs. The State of Bihar & Ors. [1971 (2) SCC 236] a fee has been described by the Hon'ble Apex Court as a charge having a reasonable co-relation with the services rendered and an element of quid pro quo for the services rendered being satisfied-generally for a regulatory fee and a little more specifically albeit not mathematically for a compensatory fee. In the context of the legal connotation of a fee as enunciated by the Hon'ble Supreme Court, the payment of 1% of the total value of the works contract under the notification dated 30.04.1993 as a condition to avail the exemption from payment of tax otherwise levia....