ANAMIKA MOTORS Vs. STATE OF ASSAM

JUDGEMENT

(1.) Heard Dr. Ankit Todi, learned counsel for the petitioner. Also heard Mr. D. Saikia, Advocate General for the State, assisted by Mr. A. Chaliha, learned standing counsel for the Finance Department, representing respondent nos. 1 to 5 as well as Ms. G. Hazarika, learned standing counsel for the Central Excise & Service Tax Department, appearing for respondent nos. 6 to 9.

(2.) By this writ petition filed under Article 226 of the Constitution of India, the petitioner has assailed (i) the assessment order dtd. 10/8/2010 (Annexure-5) passed by the Deputy Commissioner of Taxes, Jorhat (respondent no.4), and (ii) the revisional order dtd. 18/2/2015 (Annexure-7) passed by the Additional Commissioner of Taxes, Assam (respondent no.3). The respondent authorities had considered paint consumed during restoration and reconditioning of vehicles at Authorised Service Station as transfer of property of paints and nature of works was considered as works contract in spite of the fact that on the same work, the Central Government was collecting service tax. Thus, the only issue which is required to be determined is whether Assam Value Added Tax (VAT for short) can be levied on paints by the Taxation Department of the State by treating the nature of works as works contract resulting in transfer of property in paints during the restoration and reconditioning work.

(3.) Referring to the statements made in the writ petition, the learned counsel for the petitioner has submitted that when damaged vehicles come into the workshop of the petitioner, the condition of the vehicle is inspected and if any denting and painting service is required to be provided for reconditioning and/or restoration of the damaged panels of vehicles, such repair work is carried out with the aid of expert labourers/painters. Accordingly, it is submitted that any painting and/or denting materials that are consumed in the process would fall within the realm of a contract of service. It is submitted that in ordinary sense as understood by a common man, no one would send a vehicle for denting and painting with a view to purchase paint and other denting and painting consumables and therefore, it is contended that such contract for service does not involve or result in a transfer of property in such goods. Thus, it is submitted that no tax can be levied under the Assam VAT Act.