TMI Blog1998 (8) TMI 151X X X X Extracts X X X X X X X X Extracts X X X X ..... s favour. Therefore, for all practical purposes, the assessee is virtually the owner of the properties, i.e. flats and shops, to be constructed by it and after constructing the same, the assessee firm sells the flats and shops to the customers. 3. According to the Assessing Officer, the assessee is a contractor doing the work of site developing and flat building (only super-structure) and had acquired only the "developmental and selling rights" in the land and not the "ownership" rights. The ownership of the lands remains with the landlord who grants the Power of Attorney to the assessee for developing the land site. The ownership of flats remains with the flat purchasers who enter into a contract with the assessee firm for building the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is the work done by the assessee during the previous year which is quantified for the purposes of determining the receivables of the assessee during the previous year. In this case, the aggregate of the two is Rs. 1,76,93,000. Since the assessee had shown an opening stock of works for Rs. 99,23,000, the same may be reduced from the gross figures so as to find out the work done by the assessee during the previous year. The difference, thus worked out comes to Rs. 77,70,000, which according to the Assessing Officer was the amount of work done during the previous year. Since the previous year comprised of 21 months, the proportionate ceiling for non-audited books of account would be Rs. 70,00,000. Since the work done during the previous ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the provisions of section 44AB of the Act. Consequently, for the reasons discussed above, I cancel the penalty levied by the Assessing Officer." 5. Aggrieved by the order of the learned CIT(A), Revenue is in appeal before us. Shri Hari Krishan, the learned departmental representative strongly supported the order of the Assessing Officer. He submitted that the value of work-in-progress is very much part of turnover. In support of this argument, he relied upon the definition of "Turnover" given in Strouds' Dictionary, 5th Edn., page 2843 : "Turnover. (1) Semble, a "business turnover" is the aggregate amount of sales effected, or work done, by a business during a stated period - Miller v. Oliver Boyd 43 Sc. L.R. 270, See also Dowli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... basis for levy of sales-tax, the learned counsel submitted that as per section 2(j) of the Central Sales-tax Act, "Turnover" means the aggregate of the sale price received and receivable by a dealer in respect of sale of any goods. He further relied upon the judgment of the Calcutta High Court in Bata Shoe Co. Ltd. v. Member, Board of Revenue [] 1 STC 193 wherein it has been held that the Gross Turnover of the dealer must be ascertained by taking the aggregate of the amounts of sale price and all amounts charged and realised as sales-tax by the dealer during the period in question. He further relied upon the judgment of the Supreme Court in McDowell Co. Ltd. v. CTO[1985] 154 ITR 148 wherein it has been held in the context of the expressio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... task of interpretation of a statutory enactment is not a mechanical task. It is more than a mere reading of mathematical formulae because few words possess the precision of mathematical symbols. It is an attempt to discover the intent of the Legislature from the language used by it and it must always be remembered that language is at best an imperfect instrument for the expression of human thought and, as pointed out by Lord Denning, it would be ideal to expect every statutory provision to be "drafted with divine prescience and perfect clarity". We can do no better than repeat the famous words of Judge Learned Hand when he said : '. . . it is true that the words used, even in their literal sense, are the primary and ordinarily the most r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... verheads incurred by the assessee. It is the cost of incomplete and unfinished work and hence, it is quite similar to stock-in-trade, the ownership of which remains vested with the assessee. "Turnover" and "Sales" precisely and essentially require the transfer of title of the goods to the purchaser. The assessee could be said to have effected sales only in respect of those flats/shops construction of which is complete and the possession of which is given to the purchaser. The "Sale" or "Turnover" requires two parties to a contract, namely, a seller and a buyer. In this case, in relation to work-in-progress, the assessee is the seller, but there is no buyer and hence again work-in-progress done cannot be considered as sale. 8. As regards t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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