RAVI ENTERPRISES Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) THE appellant, a partnership firm is a registered dealer under the Central Sales Tax Act (for short, "the Act" ). This tax revision case filed by the appellant-assessee is directed against the order of the Sales Tax Appellate Tribunal (for short, "the Tribunal") affirming the penalty of Rs. 29,605 under section 10-A of the Act. It is necessary to examine the facts leading to the levy of penalty in question. The assessee is a registered dealer under the Act. The assessee entered into a contract with the Andhra Pradesh State Irrigation Development Corporation Limited, hereinafter referred to as "the Corporation" to supply and erect pumpsets with necessary accessories at the places specified by the Corporation. A purchase order was issued by the Corporation on 8th May, 1978 which incorporated the details of the equipment required for erecting the pumpsets and the time-limit within which the erection should be completed. The purchase order also contains the other terms and conditions governing the contract between the parties.

(2.) FOR the purpose of executing the contract the assessee purchased goods from outside the State and issued C forms to enable the sellers to pay the Central sales tax at the rate of 4 per cent on those goods. After taking delivery of the goods from the sellers they were put in transit and the assessee sold the very same goods to the corporation and raised sale bills in the name of the Executive Engineer of the Corporation, Khammam. The Corporation issued to the assessee C forms. The value of the goods purchased from dealers outside the State and sold in transit to the Corporation amounted to Rs. 5,05,877.

(3.) THE assessee filed an appeal before the Commercial Tax Officer against the order of the Assistant Commercial Tax Officer levying penalty. The Commercial Tax Officer affirmed the levy of penalty but reduced the penalty to Rs. 29,605. The assessee further appealed to the Tribunal against the penalty sustained by the Commercial Tax Officer. It was urged by the assessee before the Tribunal that he did not contravene the provisions of section 8 (3) (b) of the Act and in issuing the C forms to the persons from whom he purchased the goods he acted absolutely bona fide as the goods were purchased by him for resale only. The assessee further urged that the contract between himself and the Corporation was not an indivisible works contract but is severable and should therefore be considered as a contract for the supply of goods as well as for execution of works. The Tribunal declined to accept the assessee's plea and confirmed the penalty levied. This revision case is filed assailing the aforesaid order of the Tribunal. We have heard the learned counsel for the assessee, Sri S. Dasaratharama Reddi and also the learned Government Pleader. We have also gone through the purchase order and other material papers furnished.