ALSTOM POWER BOILERS LTD Vs. CTO DURGAPUR CHARGE

JUDGEMENT

(1.) IN this application under Section 8 of the West Bengal Taxation Tribunal Act, 1987 the petitioner prays for setting aside the assessment order dated June 30, 1989 passed by the Commercial Tax Officer (C.T.O.), Durgapur Charge (respondent No. 1), relating to the period four quarters ending March 31, 1985 and the Appellate order dated March 8, 1994 of the Assistant Commissioner (A.C.) of Commercial Taxes, Durgapur Circle (respondent No. 2) and the revisional order dated November 8, 2000 passed by the West Bengal Commercial Taxes Appellate and Revisional Board affirming the said assessment. The petitioner also prays for a declaration that the petitioner in the fact and the circumstances of the case is not liable to pay any tax under Section 6D of the Bengal Finance (Sales Tax) Act of 1941.

(2.) THE case of the petitioner is that there had been several contracts of the petitioner with various parties for execution of the work regarding supply of goods and erection and installation thereof. The petitioner assigned that contract regarding erection and installation only of boilers to the pro forma respondent Babcock & Wilcox of India Ltd. Both the contracts were divisible - -one for supply of goods and another for erection and installation where no transfer of property in the goods was involved. The subcontractor, namely, the proforma respondent as such is liable to pay tax under Section 6D in respect of transfer of property in the goods, if any, involved in the execution of that agreement or contract. The sub -contractor has been assessed to tax in respect of such work and the amount paid by the petitioner to the sub -contractor was only for the services rendered and not for transfer of sale of goods in execution of works contract. The petitioner availed of the labour, skill and services of the sub -contractor regarding installation and erection and paid for such services, not for any sale of goods. In this case both the dealers - -the petitioner and the pro forma respondent have been made liable to pay tax in respect of the same transfer which is not lawful. As actual execution of the contract was done by the sub -contractor who has been assessed and subjected to tax, the applicant cannot be made liable to pay tax any further. The levy of tax on entire consideration amount in the contract including the one assigned to the sub -contractor is bad under Section 6D read with Rule 48B of the Rules, 1941. It is the further case of the petitioner that the rate of the tax that has been levied is imaginary one. It is also the contention of the petitioner that in the assessment order, nothing is stated about the failure of the petitioner to produce books of document, etc., but in the appellate order in a most irrelevant way, question of non -production of books of account and nonpayment of tax was raised. It is also pointed out that the appellate forum did not entertain the prayer for giving time for production of such books of account and records nor the said forum acceded to the request for the visit of the site for inspection of such records. Even the Board - -the last fact finding authority affirmed the appellate order without examining the books of account and other records. Saddling the petitioner with liability to pay tax under Section 6D of the Act of 1941 in respect of the very goods which have been subjected to tax in the hands of the sub -contractor is unlawful and the assessment made on such untenable ground cannot be sustained in law.

(3.) THE petitioner used affidavit -in -reply. Besides reiterating the facts and points noted in the main application, it is stated that the contract filed would show engagement of sub -contractor was for rendering services since petitioner had no expertise in the installation or erection of boilers. The petitioner also finds some motive for using the word "etc." in the assessment order. The petitioner wants to say that the word "etc." has been used to avoid the word "installation". It is further contended that if the several principal contracts between the petitioner and the other parties and six corresponding sub -contracts for installation between the petitioner and the sub -contractor could have been examined by the respondent No. 1 he could have found these to be divisible. The invoice relied upon by the respondent throws no light on the nature of the contract. Respondent No. 1's conclusion regarding covering of the petitioner's case under Section 6D having been based solely on the said invoice led to error causing injustice to the petitioner who as such has to come up here for redress.