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2013 (4) TMI 586 - HC - VAT and Sales TaxReassessment orders - sale or works contract - bifurcation of order - petitioner was a partnership firm and engaged in the business of execution of works contract - Held that:- A bare perusal of the assessment order would show that the assessing authority has noticed only this much that the copies of certain documents such as contract and tender agreement etc. were produced which show that the work of supply, installation, commissioning, loading and unloading were included therein. But the assessing authority failed to take note of the fact that the supply of generators and commissioning expenses were shown at ₹ 10,82,101. While the petitioner has shown the purchase of generator for ₹ 5,89,93,249.96, which gives the commissioning expenses to 1.77% of the total amount of supply ₹ 6,11,01,227/-. The attention of the assessing authority escaped this aspect of the case which is vital and goes to the root of the matter. As in the case of M/s. Kone Elevator (India) Ltd. (2005 (2) TMI 519 - SUPREME COURT OF INDIA) 0Apex Court has laid down test to find out as to whether a particular transaction is supply of goods or of work contract & held that the assessee therein divided the execution of the contract into two parts namely work to be initially done in accordance with the specifications laid down by the assessee and "the supply of lift by the assessee". The "work part" in the contract was assigned to the customer and the supply part was assigned to the assessee. Here, the "work part" as well as "supply part" were assigned to the petitioner. It is not necessary to dwell upon the issue any further as it may prejudice the case of either party. Suffice it to say that there is material before the respondents to form a belief that the turnover of the petitioner has escaped the assessment. The assessing authority while framing the assessment order has overlooked the judgment of the Apex Court on the issue given in the case of M/s. Hindustan Shipyard Limited Vs. State of Andhra Pradesh [2000 (7) TMI 864 - SUPREME COURT OF INDIA] and the principle laid down therein has been reiterated in M/s. Kone Elevator (India) Ltd. (supra). Thus it is a case of escaped assessment. In view of the different provisions provided under the Act, even if the contract of the petitioner is taken as a work contract, then also trade tax was payable on the sale of the movable goods supplied under the contract.
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