9911796707
TMI Blog2007 (10) TMI 589X X X X Extracts X X X X X X X X Extracts X X X X ..... erred to as "the dealer") was engaged in the business of purchases and sales of truck chassis. During the years under consideration, the dealer had purchased body from various persons and got it mounted over the chassis. The assessing authority levied the penalty under section 8D(6) of the Act on the ground that the dealer had got the body constructed over the chassis from the contractor under the works contract and, therefore, while making the payment to the contractor should have deducted four per cent and should have deposited the same in the State treasury as required under section 8D(1) of the Act. Since the dealer had not complied with the provisions of section 8D(1) and had not made deduction from the payment to the contractor inasmu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sis, the contract was in the nature of works contract. He submitted that the contract being in the nature of works contract, the dealer was under the obligation to deduct the tax from the payment to the contractor. The learned counsel for the dealer submitted that the apex court in the case of T.V. Sundram Iyengar & Sons v. State of Madras reported in [1975] 35 STC 24 has held that the construction of the body over the chassis is the sale of body and not in pursuance of works contract. He submitted that predominant object was to purchase the body and, therefore, there was a sale of bus body by the party to the dealer and the purchase of such body by the dealer. He submitted that the finding of the Tribunal in this regard is the finding of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he facts and circumstances of the case, the Tribunal has held that the dealer had purchased the body and got it mounted over the chassis and it is not a case of works contract, placing reliance on the decision of the apex court in the case of T.V. Sundram Iyengar & Sons v. State of Madras reported in [1975] 35 STC 24. Finding of the Tribunal is finding of fact. In any view of the matter whether the contract was works contract or the contract for sale was highly debatable and, therefore, if under the bona fide belief that the contract was for sale of body and not works contract the tax has not been deducted under section 8D(1), penalty could not be levied under section 8D(6) of the Act, as there was no deliberate or wilful defiance on the pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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