TMI Blog2001 (9) TMI 1114X X X X Extracts X X X X X X X X Extracts X X X X ..... d form in carrying out a works contract, and therefore the provision in section 3-B(2)(b) of the TNGST Act which reads "all amounts for which any goods, specified in the First Schedule or Second Schedule, are purchased from registered dealers liable to pay tax under this Act and used in the execution of works contract in the same form in which such goods were purchased", is inconsistent with article 366(29A) and therefore the allegedly offending words in section 3-B(2)(b) of the Act should be struck down. 2.. Sub-section (2) to section 3-B of the State Act provides for the deduction to be made from the total turnover of the dealer who is engaged in execution of the works contract, to arrive at the taxable turnover. Sub-clause (b) limits t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... what had been bought must be regarded as the item which is made a part of the works contract by reason of the words in the parenthesis under article 366(29-A). 5.. Counsel places great reliance upon a decision reported by the Andhra Pradesh High Court in Media Communications v. Government of Andhra Pradesh [1997] 105 STC 227 the relevant part of which is found at pages 242 and 243. The court there was concerned with the challenge to the validity of part of section 5F of the Andhra Pradesh General Sales Tax Act, which referred to transfer of property in goods whether as goods or in some other form. The court referred to the definition of "goods" in section 2(h) of that Act as also explanation VI to definition of "sale". Reading the two de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said goods were purchased, will result in levying tax at more than one stage violating the mandate contained in section 15 of the Central Sales Tax Act and article 286(3) of the Constitution and on that ground whether section 3-B of the Act is liable to be struck down?" The other questions formulated therein examined other facts of some arguments on the unconstitutionality of section 3-B(2)(b). 9.. After elaborately considering the matter with reference to the statutory provisions as also the decision of the apex Court and the provisions of the Constitution, the court concluded thus: "we see no infirmity in sub-section (2)(b) of section 3-B which says that in computing the taxable turnover of a dealer of transfer of property involved i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs, buys iron and steel for the purpose of manufacture, after paying tax on such purchase, he cannot contend while selling the shutters that no tax should be levied on the shutters as they have been manufactured from iron and steel on which he has already paid tax. The iron and shutters are commercially distinct commodities and are charged to tax accordingly. That position will not change merely because the person who buys the iron or steel, after making the rolling shutter, chooses to transfer the property in the form of shutter to a person who may want to use it in the home or as an attachment to the building. The goods and the property in which it is transferred in such a case remains the property in shutter and not in the iron which had ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
