9911796707
TMI Blog1999 (1) TMI 506X X X X Extracts X X X X X X X X Extracts X X X X ..... the expression 'in the same form' does not include such goods which, after being purchased, are either consumed or used in the manufacture of other goods which in turn are used in the execution of works contract." 2.. Arguments have been heard. Liability of tax in respect of building contract was examined by the apex Court in the case of State of Madras v. Gannon Dunkerley & Co. (Madras) Ltd. [1958] 9 STC 353 and it was held that in a building contract the property in material used does not pass to the other party to the contract as movable property. The building contract is one entire and indivisible. There is no sale of goods. In order to overcome the said decision article 366 of the Constitution was amended inserting entry (29-A) by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the amount specified in clauses (a) to (p), shall subject to the conditions specified therein be deducted from the total turnover. This rule was amended on October 7, 1994 with effect from April 1, 1993. Rule 6(4)(m)(i) provided the exclusion of all amounts received or receivable in respect of goods specified in various serial numbers of the Sixth Schedule which are purchased from registered dealers liable to tax under the Act. It is the amendment dated August 5, 1995 which has been made retrospective with effect from April 1, 1993 in which for the purpose of exclusion it is provided that,- "(i) all amounts received or receivable in respect of goods other than the goods taxable under sub-section (1-A) or (1-B) of section 5 which are purc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Andhra Pradesh High Court. It was found that it cannot be disputed that any transformation of the goods from one form to another in the execution of the contract, will not amount to the creation of a different or distinct commercial commodity exigible to tax once again. The expression "in the same form" was found contrary to the intention of section 5-F to tax the goods utilised in the works contract in whatever form it may be transformed during the execution of the works contract. The proviso was struck down as void. 7.. The validity of the 46th Constitutional Amendment Act was upheld by the apex Court in Builders Association of India v. Union of India [1989] 73 STC 370. 8.. In Builders' Association of India v. State of Karnataka [1993 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or contrary to the provisions of the Act or the Constitution of India. While giving the deduction the rule-making authority could have given the deduction for purchase of an item which is used in the same form and which is used in some other form. Simply because the deduction has not been given to an item used in another form, it cannot be considered to be beyond the legislative competence. The works contract under section 5-B and article 366(29-A)(b) using the words "in other form" refers to the power of the Legislature to levy the tax. The power which has been exercised in enacting the provisions of section 5-B is in accordance with the constitutional mandate. But to which item, and in what circumstances exemption is to be given is ancil ..... X X X X Extracts X X X X X X X X Extracts X X X X
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