TMI Blog1985 (2) TMI 239X X X X Extracts X X X X X X X X Extracts X X X X ..... f Rs. 9,55,485.78 which represented the purchase value of sand and blue-metal from unregistered dealers, which the assessee had used in the construction of the buildings. The assessee claimed that the said sum of Rs. 9,55,485.78 representing the purchase price of blue-metal and sand cannot be brought to charge under section 7-A of the Act. That contention was negatived by the assessing authority and the said turnover was brought to charge. The matter was taken in appeal to the Appellate Assistant Commissioner, who also sustained the levy under section 7-A of the Act on the said turnover. Thereafter, the matter was taken up in further appeal to the Sales Tax Appellate Tribunal by the assessee denying his liability to be assessed to tax under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the course of his business purchases from a registered dealer or from any other person, any goods (the sale or purchase of which is liable to tax under this Act) in circumstances in which no tax is payable under section 3, 4 or 5, as the case may be, and either, (a) consumes such goods in the manufacture of other goods for sale or otherwise; or (b) disposes of such goods in any manner other than by way of sale in the State; or (c) despatches them to a place outside the State except as a direct result of sale or purchase in the course of inter-State trade or commerce, shall pay tax on the turnover relating to the purchase as aforesaid at the rate mentioned in section 3, 4 or 5, as the case may be, whatever be the quantum of such turnov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll within clause (a) of section 7-A(1) of the Act, the learned Additional Government Pleader placed reliance on the decision of the Supreme Court in Ganesh Prasad Dixit v. Commissioner of Sales Tax [1969] 24 STC 343 (SC). The purchasing dealer in that case was a building contractor and he is said to have consumed the goods purchased in his business. After finding that he has used the materials purchased by him in his business, the Supreme Court held that the purchase turnover of the building materials by the purchasing dealer will attract section 7 of the Madhya Pradesh General Sales Tax Act, 1958, on the purchase price of the goods used in the course of their business as building contractors. The said decision proceeds on the basis that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A(1) of the Act. In this case, the Tribunal has referred to the decision of the Andhra Pradesh High Court in Nandanam Construction Co. v. Assistant Commissioner [1983] 53 STC 42 where the building contractor purchasing goods for use in the construction of buildings has been held not to come within the mischief of clause (a). Even though that decision supports the view taken by the Tribunal, it has not considered the scope of the expression "manufacture of other goods for sale" occurring in clause (a) of section 7-A(1). The Andhra Pradesh High Court purports to follow the decision of the Supreme Court in Deputy Commissioner of Sales Tax v. Pio Food Packers [1980] 46 STC 63 (SC), which does not deal with a case of the purchasing dealer using ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se than by way of sale in this case. This contention of the learned Additional Government Pleader ignores the significance of the use of the expression "disposes" in clause (b). "Disposal of goods in any manner other than by way of sale" would indicate that there has been a transfer of the goods other than by way of sale from the assessee to some other person. In this case, admittedly there is no disposal or transfer of the goods in any manner otherwise than by way of sale as contemplated by the section, but the goods have been used in the construction of the buildings and such user cannot be said to be a disposal of the goods as contemplated by clause (b) of section 7-A(1) of the Act. We are, therefore, of the view that clause (b) of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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