ROY ENGINEERING CO Vs. STATE OF TRIPURA

JUDGEMENT

(1.) In these writ petitions under Article 226 of the Constitution of India, the petitioner challenged the vires of retrospectivity of Section 3 A of the Tripura Sales Tax Act (hereinafter referred to as the Act ) and consequently challenged the impugned order dated 9.11.93 passed in appeal case No.90 and 91 of 1992 by the learned Tribunal constituted under the Act.

(2.) The petitioner's case precisely could be narrated as follows:- (C.R.No. 17 of 1994) The petitioner is a registered contractor under various statutory authorities including Oil & Natural Gas Corporation (ONGC). The Superintendent of Taxes passed an assessment order dated 29.4.88 under Section 9(3) of the Act on best judgment assessment and determined the turnover at Rs. 8,10,146.88 and accordingly assessed the sales tax and imposed a penalty of Rs. 23,990.83 showing total tax payable at Rs. 71,972.50 for the assessment year 1393 B.S. on the contract works done by the petitioner under respondent Nos. 5 and 6(Executive Engineer and Superintending Engineer, ONGC respectively). The Taxing authority issued demand notice requiring the petitioner to pay the aforesaid dues. The petitioner moved a writ petitioner before this court in Civil Rule No. 124/88 challenging the validity of the assessment order. This Court vide der dated 23.5.90 allowed the writ petition directing ti e Commissioner of Sales Tax to admit the statutory appeal and to decide the matter on merit. The Court did not examine the vires of provision of amended Section 3 A of the Act. The petitioner preferred statutory appeal accordingly and after hearing, the Addl. Commissioner of Sales Tax vide order dated 20.10.02 quashed the order of imposition of penalty only while maintained the order of assessment and tax payable as determined by the Superintendent of Taxes. The Tripura Legislative Assembly amended the Act by Tripura Sales Tax(Fourth Amendment) Act. 1987 substituting the provision of Section 3A thereto for the purpose of assessment and recovery of sales tax on works contract. By Section 1 (3) of the Fourth Amendment Act, the amended Section 3A of the Act has been made retrospective effect from 12-7-84. The petitioner executed works contract pursuant to the works order issued by the respondent Nos. 5 and 6 for the construction of buildings etc. and the petitioner submitted the tender without claiming or adding sales tax over his quoted rate. The retrospective effect of Section 3 A of the Act according to the writ petitioner is unreasonable, absurd, unjust and against the principle of practicability and as such he challenged the decision of the Tribunal as well as the validity of the aforesaid amended Section 3 A of the act.

(3.) The State respondents contested the case by filing counter affidavit wherein it is contended, inter alia, that the petitioner firm concealed the actual turnover in its return and on the basis of the entries made in the books of accounts of the petitioner firm and after allowing the petitioner opportunity of being heard, the authority assessed the turnover determining the tax and imposed the penalty. Pursuant to the amended provision of Section 3 A of the Act the authority assessed the tax on the price of the goods/commodities unused in execution of the works contract while the petitioner wrongly shown 4 percent of the tax on the tender value of the contract pursuant to the pre-amended provision. The Act has been amended pursuant to the 46th Amendment of the Constitution of India and as such in amending the section 3A, no illegality has been committed by the State Assembly and the Sales Tax Authority being lawfully competent asked for deduction at source. The respondent Nos 5 and 6 filed separate counter affidavit contending, inter alia, that on the basis of demand notice they being under legal/statutory obligation made attempt to deduct the tax as assessed by the Sales Tax Authority.