TaxTMI 
TaxTMI 
2015 (3) TMI 210
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....he writ petition were decided by judgment dated 25.02.2002, are common with the issues raised in said Special Appeals. The matter was earlier pending before the Rajasthan Taxation Tribunal, and after its abolition, was transferred to this Court. D.B. Civil Special Appeal(W) Nos.177/2002, 179/2002, 174/2002, 175/2002, 176/2002, 178/2002 and 173/2002, arises out of the proceedings of Assessment Years 1990-91, 1994-95, 1995-96, 1996-97, 1997-98, 1998-99 and 1999-2000, and are directed against the order dated 25.02.2002, passed in S.B. Civil Writ Petition No.724/2002 and six other connected writ petitions. D.B. Civil Special Appeal Nos. 117/2002, 120/2002 and 118/2002, arising out of the proceedings of Assessment Years 1989-90, 1990-91 and 1991-92, against the order dated 24.02.2002, passed in S.B. Review Petition Nos.14/2000, 10/2000 and 16/2000. D.B. Civil Special Appeal Nos.6/2012 and 5/2012, arise out of the proceedings of Assessment Years 1992-93 and 1993-94, challenging the order dated 01.03.2012, in S.B. Civil Review Petition Nos.12/2000 and 13/2000, passed in the light of the order dated 24.02.2002 by a coordinate Bench of this Court in S.B. Review Petition Nos.14/2000, 1....
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....nition of 'sale'. The work performed by the appellant-Company was not an undivided work contract. 5. The petitioner-Company had prayed for grant of exemption certificate in respect of work orders dated 23.08.1988 and 10.08.1992, as per the application submitted by it, and for a direction to treat the contracts dated 23.08.1988 and 10.08.1992, as indivisible and composite works contract, which do not constitute sale of goods. 6. A preliminary objection has been raised by learned counsel appearing for the Revenue, that the order passed by the Deputy Commissioner(Appeals), Commercial Taxes, Ajmer, dated 24.05.1997 under Section 84 of the Rajasthan Sales Tax Act, 1994 (for short, 'the Act of 1994'), is subjected to further appeal before the Rajasthan Tax Board, both, on merits and for rejection of the application for grant of exemption under Rule 10A and 10B of the Rules, made under the Act. 7. It is submitted by learned counsel appearing for the petitioner-Company that the subject contracts are composite/indivisible work contracts. The terms and conditions of the work orders and the agreements as also the nature of work undertaken, clearly establishes th....
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....ion of India and others Vs. Union of India and others, (1989) 2 SCC 645, and Gannon Dunkerley & Co. Vs. State of Rajasthan, (1993) 1 SCC 364. 10. The Deputy Commissioner(Appeals), vide his order dated 24.05.1997, had affirmed the assessment orders with respect to the Assessment Years 1989-90, 1990-91, 1991-92, 1992-93 and 1993-94, and had also affirmed the finding in the Assessment Orders that the applicant was not entitled to grant of exemption certificate, and the finding that the contract was a divisible contract; one for supply of pipes etc. amounting to sale, and other for laying of pipes. 11. In Larsen and Toubro Limited and Anr. Vs. State of Karnataka and Anr., 2014(1) SCC 708, decided on 26.09.2013, a three Judge Bench of the Hon'ble Supreme Court has held that the term 'works contract' in Article 366(29A)(b) of the Constitution of India, is amply wide and cannot be confined to a particular understanding of term, or to a particular form. Once characteristics or elements of works contract are satisfied in a contract, then irrespective of additional obligations, such contract would be covered by term 'works contract'. The term ....
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....ser. The value addition made to goods transferred after agreement is entered into with flat purchaser can only be made chargeable to tax by the State Government. In May, 2005, almost all the States had modified their laws in line with Raheja Development and there is no justification for change in position settled after decision of the Supreme Court in Raheja Development. If at the time of construction and until construction was completed, there was no contract for construction of building with flat purchaser, goods used in construction could not be deemed to have been sold by builder since at that time there was no purchaser and that building was intended for sale ultimately after construction does not make any difference. Raheja Development's case was held to lay down a correct legal position. 12. The Supreme Court further held in Larsen and Toubro Limited and Anr.(supra), that the value of the goods which can constitute the measure of the levy of the tax, has to be the value of the goods at the time of incorporation of goods in the works even though property in goods passes later. Taxing the sale of goods element in a works contract is permissible even after incorporat....
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....ion of India, and was then transferred to this Court on abolition of the Tribunal, and thus the question involved in this petition was pending in the Special Appeal, filed by the present petitioner for different contracts against the judgment dated 25.02.2002, passed in S.B. Civil Writ Petition No.724/2002, and six other connected writ petitions. Learned Single Judge was not inclined to non-suit the petitioner to avail the alternative remedy against the order passed by the Deputy Commissioner(Appeals), Commercial Taxes Department, and therefore, the preliminary objection was not held sustainable. He further observed that the only question which remains to be considered, was whether the petitioner is entitled to exemption, which in fact is a scheme of composition of tax payable in respect of sale of goods, the property in which passes as a result of execution of work contract at the fixed rate, notified by the State Government in that regard under Rule 10-B of the Rules. 19. The issue, according to the petitioner, was decided against it by learned Single Judge of this Court in S.B. Civil Writ Petition No.724/2002, and six other connected matters on 25.02.2002, in which it was held ....
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....itions stood transferred to this Court." 23. Learned Single Judge thereafter held that the impugned order passed by the Tribunal does not make any reference of the fact whether this question was raised before it or not. Learned counsel for the respondents brought to the notice of the Court that in computing the turn over, deduction has been allowed at the rate of 4% and not at the rate of 12% and, therefore, on the merits on the case, the said contention does not survive, and in that view of the matter, he was of the view that the impugned order does not require to be reviewed by the Court. The review petitions were consequently dismissed. 24. It is pertinent to notice that the Rajasthan Taxation Tribunal, constituted under the Rajasthan Taxation Tribunal Act, 1995, was constituted exercising powers under Article 226 and 227 of the Constitution of India. The Act was found to be constitutionally invalid, and was thus repealed by the State of Rajasthan by the Rajasthan Taxation Tribunal(Repeal) Act, 1999 (Act No.5 of 1999), which came into force on 30.04.1999. Section 5 of the Repealed Act, provides that all matters and proceedings pending before the Tribunal on the dat....
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....0 of the Act of 1994 for grant of exemption in terms of the Notification in respect of the contract for laying of pipelines awarded to the petitioner by the PHED, Ajmer, vide work order dated 18.04.2001. The Additional Commissioner (Anti Evasion), Commercial Taxes Department, Jaipur, granted exemption to the petitioner, vide its order dated 19.07.2001, in terms of the Notification dated 29.03.2001. The Assessing Authority and the Appellate Authority, by their orders for the respective assessment years, treated the supply of pipes by the petitioner to the PHED, to be sale within the meaning of Section 2(o) of the Act of 1994. 29. Learned Single Judge held that substantial part i.e. 75% of the material supplied by the petitioner, constituted a sale within the meaning of Section 2(o) of the Act, on which the petitioner was liable to pay sales tax. If the petitioner had paid any works contract sales tax to the PHED, if and when any certificate from the Department is produced before the Sales Tax Department, the Assessing Authority was required to adjust that amount against the total amount of sales tax. The Assessing Authority as well as the Appellate Authority had applied their mind ....
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....ment of Hon'ble Supreme Court in Builders Association of India and others Vs. Union of India and others(supra) and Gannon Dunkerley & Co. Vs. State of Rajasthan(supra), it was held that the exemption Notification dated 29.03.2001, cannot be given retrospective effect and will only apply prospectively with effect from the year 2001-02 onwards. 34. The legal proposition with regard to definition of 'works contract' in Article 366(29A)(b) of the Constitution of India, has been explained in the recent judgment in Larsen and Toubro Limited and Anr. Vs. State of Karnataka and Anr.(supra), decided on 26.09.2013. For sustaining levy of tax on goods, deemed to have been sold in execution of a works contract, three conditions namely (i) there must be a works contract; (ii) goods should have been involved in execution of a works contract; and (iii) property in those goods must be transferred to a third party, either as goods or in some other form, have been amply clarified. A contract may involve both, a contract of work and labour, and a contract for sale. A transfer of property in goods under clause 29A(b) of Article 366, is deemed to be sale of goods involved in execution of a....