KANHU CHARAN DAS Vs. STATE OF ORISSA

JUDGEMENT

(1.) THE petitioner is a contractor during the period 30th June, 1963, to 31st December, 1964. He entered into a contract with the State of Orissa for construction of dual carriage way from Cuttack to Kujang. The petitioner's case is that the agreement under which he worked was of a composite character for the construction of road. There was no separate agreement for sale of materials and accordingly he is not liable to pay sales tax on the construction work. The Sales Tax Officer assessed the petitioner in respect of the movable goods supplied in connection with the construction of the road. This writ application has been filed for quashing the aforesaid assessment orders as no tax is payable.

(2.) WE have gone through the agreement under which the petitioner worked. The name of the work is construction of dual carriage way between Cuttack (O. M. P. junction) to Kujang. The estimated cost is Rs. 7,32,857. As usual in the tender for works the different works to be done have been distinguished from some of the items with reference to supply and stacking of materials on the roadside. Read by itself, this might mean that there was supply of materials but such supply of materials constituted an integral part of the construction of the road. There is no agreement to supply the materials independently of the construction. In every construction some movable articles are to be used. They are not liable to be charged with sales tax merely because in the tender they were indicated separately. Items (5) and (6) of the tender would show that the articles to be supplied were to be used in the construction of the road. For illustration, items (5) and (6) may be referred :

(3.) WE accordingly quash the assessment orders dated 31st December, 1965, and the appellate orders dated 8th October, 1966. A writ of certiorari be accordingly issued. The writ application is allowed but in the circumstances there will be no order as to costs. The tax collected be refunded. Application allowed.