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2009 (8) TMI 1163 - HC - Service TaxConstitutional validity of certain provisions of the Kerala Stamp Act, 1959, which were introduced by way of an amendment by the Finance Act, 2007 - scope of works contract. Held that: - there is no reason for the third petitioner to include those conditions, if he is only a works contractor. Those conditions would show that the third petitioner is more than a works contractor. A close reading of Ext.P2 would show that the third petitioner is not at all a works contractor. Yet another relevant fact is that it was the third petitioner who obtained the building permit from Kakkanad Panchayat, under the Kerala Municipality Building Rules, 1999, which were extended by the Government to the said Panchayat's area also. So, it is the responsibility of the third petitioner under the said Rules to build the apartments in accordance with the conditions of the building permit and also in compliance with the relevant Rules. Therefore, the third petitioner is not a works contractor. If the veil is lifted, it is clear that the builder is building and selling flats to prospective buyers and the sale consideration is received in instalments. But, agreements are made to appear the transaction to be one of works contract. If it is a works contract and the owner is constructing a building in his property, no duty can be levied on the building constructed because no transfer takes place. A legislation cannot be invalidated by simply saying that its provisions are arbitrary, unless the challenge is referable to specific violation of any constitutional provision. The payment or the liability to pay stamp duty will not, in any way, affect the rights of the first petitioner or its members to carry on the business of development of lands or building flats. Petition dismissed - decided against petitioner.
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