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2012 (8) TMI 407 - HC - VAT and Sales TaxContract for performance of work of laying HDPE pipe for transportation of natural gas – determination of nature of the contract namely whether the said contract was an indivisible interstate works contract or a contract to supply pipes and a contract to lay down the pipes - Revenue considered the transaction as a divisible transaction – Held that:- The use of HDPE pipes was an integral part of the performance of the contractual obligation by the applicants in as much as the applicants were required to lay down the tranches and lay down the pipes which would be reaching at site. The payment terms also clearly indicates that the applicants were entitled to get money from Assam Gas depending upon the performance of various acts required to be done for the successful fulfillment of terms of the contract. Further, Clause 9 and clause 21 refers to the term 'contract value' and ‘turnkey basis’ respectively which clearly indicates that the consideration payable was to be calculated as a whole and not in parts. If at all the contract was intended to be divided into two parts, the said payment terms would have indicated that the applicants would be entitled to get cost of the pipes on delivery of required quantity of pipes to be used for the purposes of laying the pipes In view of aforesaid it is held transaction to supply and laying down the pipe being inseparable, it would constitute works contract and to such a works contract, the liability to pay Central Sales Tax would arise only after 11.05.2002 and since the transaction in the present case pertains to the period prior to 11.05.2002, the applicant would not be liable for Central Sales Tax.
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