SUGAM PARIVAHAN LTD. Vs. THE STATE OF TRIPURA

JUDGEMENT

(1.) THE petitioner by means of this petition has challenged the communication dated 29.10.2009 whereby 4% tax has been deducted from the bills payable to the petitioner.

(2.) THE undisputed facts are that the petitioner is a Transporter dealing with the carriage of goods only. He was engaged by the Tripura Horticulture Corporation Ltd., which is a Government of Tripura undertaking to carry power tillers and other agricultural inputs purchased by the Tripura Horticulture Corporation from Kerala to Agartala in Tripura. The short question involved is whether this contract by which the petitioners had agreed to transport the goods amounts to sale within the meaning of the TVAT Act or not. Sale has been defined in Section 2(25) of the TVAT Act which reads as follows:

(3.) WE are clearly of the view that the phrase "transfer of property in goods" has been expanded in the context of works contract to include those goods which are used in the execution of the works contract. This expansion of the definition can however not bring within its ambit the mere transportation of goods. When a person transports goods on behalf of the consigner or the consignee there is no transfer in the property of goods either directly or by inference. A contract to transport goods from one place to another is not a works contract. The amount which a transporter receives may be included in the sale value for calculating the taxable turnover but by no stretch of imagination can the transporter be held liable to pay tax? We are, therefore, clearly of the view that the deduction of tax on the amount paid to the transporter/petitioner is illegal and is liable to be quashed and the same is accordingly quashed. The tax which has been deducted shall be refunded to the petitioner along with statutory interest within 3(three) months from today failing which the State shall be liable to pay interest @ 12% per annum. In case there are any taxes due from the petitioner the State shall be at liberty to adjust the refundable amount against the taxes due from the petitioner to the State.