TMI Blog1997 (4) TMI 481X X X X Extracts X X X X X X X X Extracts X X X X ..... aradip Port Trust (hereinafter referred to as the Port Trust ). An agreement relating to allotment of work was executed on March 19, 1996 and the parameter of work to be executed has been detailed in the said agreement. The consideration for which the contract has been awarded is nearly Rs. 18 crores. Break-up for various descriptions of works and corresponding contract values have been indicated in the agreement itself. 3.. According to the petitioner, the work awarded did not involve any transfer of material by the petitioner to the Port Trust, and the payments received by it did not constitute sale price. Certain amounts were deducted from the payments made to the petitioner under section 13-AA of the Act. A letter dated July 24, 1996 was issued by the petitioner to the Sales Tax Officer, Cuttack II, Ward A Circle for refund of Rs. 9,61,966 which was deducted at source by the Port Trust. On receipt of the said letter for refund, the aforesaid Sales Tax Officer (opposite party No. 2 in the writ application) issued a notice dated July 5, 1996 under section 12(5) of the Act for the period 1995-96 alleging that the petitioner s turnover for the said period exceeds Rs. 1 lakh. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unregistered dealer within the territorial jurisdiction of his circle; that the proceeding under section 12(5) of the Act was initiated against the petitioner; that an enquiry report submitted revealed that there was reason to believe that the works contractor attracted tax liability for which the Port Trust was deducting 4 per cent towards tax deduction at source from the company; and there was no reason to grant no deduction certificate in favour of the company. By order dated December 12, 1996 the order of the Sales Tax Officer (opposite party No. 2) was vacated by this Court, and it was directed that the application for grant of certificate of non-deduction at source was to be dealt with by the officer having jurisdiction. 4.. By the impugned order (annexure 1) the Sales Tax Officer (opposite party No. 1) has rejected the application dated August 28, 1996 for issuance of certificate of non-deduction of tax at source. The operative portion of the order reads as follows: On the date of hearing the learned advocate of the dealer-contractor claimed that the work executed at Paradeep is 100 per cent labour oriented. On examination of the work order it is founded that the works ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciate the rival submissions the provisions contained in section 13-AA(5)(a) and rule 37-D along with form XI-C, Parts I and II need to be noted. They read as follows: Section 13-AA(5)(a): Where, on an application being made by the contractor in this behalf, the Commissioner is satisfied that any works contract of the nature referred to in sub-section (1) involves both transfer of property in goods and labour or service, or involves only labour or service and, accordingly, justifies deduction of tax on a part of the sum in respect of the works contract or, as the case may be, justifies no deduction of tax, he shall, after giving the contractor a reasonable opportunity of being heard, grant him such certificate as may be appropriate, in the manner prescribed: Provided that nothing in the said certificate shall affect the assessment of the sales tax liability of the contractor under this Act. Rule 37D. Grant of certificate of no deduction/deduction of tax at source, by the Commissioner to the dealer/works contractor.-(1) The application for grant of certificate of no deduction or deduction of tax at source under sub-section (5) of section 13-AA shall be made in duplicate in P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (for official use) This is to certify under section 13-AA(5)(a) of the Orissa Sales Tax Act, 1947 read with rule 37-D of the Orissa Sales Tax Rules, 1947. 1.. That the abovementioned works contract involves both transfer of property in goods and labour or service or involves only labour or service, and accordingly, justifies deduction of tax at source, at the rate prescribed under section 13-AA(1) of the Orissa Sales Tax Act from.....................% of the sums received by the contractor M/s.....................................in respect of the said works/justifies no deduction of tax at source from the sum received in respect of the said works. (strike out words not applicable). 2.. That this certificate shall remain valid till final payment is received in respect of the said work or till it is cancelled/modified by the issuing authority, whichever is earlier. 3.. That nothing in the said certificate shall affect the assessment of the sales tax liability of the contractor under the Act. Date: Signature of issuing authority 7.. A conspectus of the above provisions makes it abundantly clear that if an application is made in terms of rule 37-D for grant of certific ..... X X X X Extracts X X X X X X X X Extracts X X X X
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