TARAPORE AND CO DHUN BUILDING 827 ANNA SALAI CHENNAI Vs. DEPUTY COMMISSIONER OF INCOME TAX SPECIAL RANGE IX CHENNAI

JUDGEMENT

(1.) The following are the substantial questions of law raised by the assessee on which this Tax Case Appeal was admitted by this Court:

(2.) Learned counsel appearing for the assessee submits that he is not pressing the second substantial question of law. An endorsement to that effect has also been made by the learned counsel appearing for the assessee. Hence, the question that survives for consideration herein is the first substantial question of law.

(3.) The assessment year under consideration is 1987-88. The assessee herein had an agreement with Naval Science and Technological Laboratory (NSTL) for the execution of work under an agreement dated 22nd August 1985. The agreement related to civil works of High Speed Towing Tank Complex. The contract execution contemplated that the assessee herein, as a contractor, shall provide all materials including steel and cement, labour, energy and water, all tools, tackles, plant and transport, necessary for the proper execution of the work to the satisfaction of the owner, namely NSTL. The total contract price as per the contract was given as Rs.5,07,55,102/-. Article 4 gives the details of the contract price, which is stated to have been arrived at based on the quantities and the rates as stated in Annexure IV of the agreement. Article 4.02 states that the contract price to be paid to the contractor shall be adjusted based on the actual quantity executed under various items of work as per the schedule of items.