2004 (8) TMI 702

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....the Tribunal was, whether the applicant was liable to tax on the photographic papers imported from outside the State of U. P. and used in the execution of the said works contract and what should be its turnover. Applicant had imported photographic papers from outside the State of U. P. for Rs. 55,48,506 and used in the works contract. Assessing Authority estimated the sale turnover of such photographic papers at Rs. 66,84,000. First appeal filed by the applicant was rejected. Tribunal has also rejected the second appeal by the impugned order. 3. Heard learned Counsel for the parties. 4. Learned Counsel for the applicant submitted that in view of Clause 2 (b) (i) under Section 3-F the value of goods imported from outside the State of U....

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....y in goods (whether as goods or in same other form) involved in the execution of a works contract. at such rate not exceeding fifteen per cent as the State Government may, by notification, declare and different rates may be declared for different goods or different classes of dealers. (2) For the purposes of determining the net turnover referred to in sub-section (1), the following amounts shall be deducted from the total amount received or receivable by a dealer in respect of a - (a) transfer referred to in Clause (a) of sub-section (1) whether such transfer was agreed to during that assessment year or earlier, - (i) the amount representing the value of the goods-covered by Sections 3, 4 and 5 of the Central Sales Tax Act, 1956....

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....such sub-contractor under the provisions of this Act; (viii) the amount representing the charges for planning, designing and architects fees; (ix) the amount representing the charges for obtaining on hire or otherwise machinery and tools used for execution of the works contract; (x) the amount representing the cost of consumables used in the execution of the works contract, the property in which is not transferred in the execution of the works contract; (xi) the amount representing the cost of establishment and other similar expenses of the contractor to the extent it is relatable to supply of labour and services; (xii) the amount representing the profit earned by the contractor to the extent it is relatable to the supply of ....

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....unsel for the applicant has no force that only the purchase value is liable to be taxed under Section 3-F of Central Sales Tax Act. Section 2 (h) defines sales. Clause (ii) of Section 2 (h) includes a transfer of property in goods involved in the execution of a works contract. By fiction the transfer of property in goods involved in the execution of works contract has been treated as sale. Under the Act it is the sale of the goods, which is liable to tax. Section 3-F provides that every dealer shall for each assessment year pay the tax on the net turnover of transfer of property in goods involved in the execution of works contract. Therefore it is "turnover, which is liable to tax. "Turnover" is defined under Section 2 (i) which means the a....