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2017 (5) TMI 734 - BOMBAY HIGH COURTSale / Deemed sale - receipt of Transferable Development Rights (TDR) - whether handing over and construction of tenements to SRA amounts to sale within the meaning of MVAT or not? - whether the issue and receipt of the TDR amounts to other valuable consideration? - Held that: - in the instant case, what is brought within the purview of the Act is a 'sale' as defined in section 2 clause (24). It means a sale of goods made within the State. Such sale must by for cash or deferred payment or other valuable consideration, but does not include what is spelt out in the first part and preceding the explanation of clause (24). Then, the Explanation follows and it is for the purpose of section 2 clause (24) itself. This explains that not only a sale within the State, including a sale determined to be inside the State in accordance with the principles formulated in section 4 of the Central Sales Tax Act, 1956 - For our purpose we have to see whether transfer of property in goods or in some other form involved in the execution of a works contract and which includes an agreement for carrying out for cash, deferred payment or other valuable consideration the works set out in subclause (ii) of clause (b) and all the other sub-clauses, namely, delivery of goods on hire purchase, the transfer of right to use any goods for any purpose, the supply of goods by any association of a body of persons etc and supply by way of or part of any service. Each of these are deemed to be a sale. Therefore, a transfer of property in goods whether as goods or in some other form involved in the execution of a works contract, including the works specified in an agreement for carrying out for cash, deferred payment or other valuable consideration and enumerated in sub-clauses of clause (b) are deemed to be a sale. The developer will be entitled to transfer or assign the TDR and/or DRC which may become available to him under this agreement as the developer may desire, without reference or recourse to or consent and concurrence of the SRA. If the very concept is understood as generating a right in favour of the developer-appellant which can be transferred for money in the open market, then, it is evident that both this agreement and also the Deed of Conveyance separately executed enable the petitioner-developer to earn consideration in the form of money. If this is a transferable property and commanding a price in the market, then, on the own showing of the petitioner-appellant, there is a money component clearly involved. The other valuable consideration for which the works are to be carried out under the works contract and which involves transfer of property in goods, therefore, is nothing but money - this is a clear transaction where the petitioner-developer has for other valuable consideration which is nothing but money, agreed to construct the number of tenements specified above and handing them over free of cost to the SRA. In return of the same, it has obtained the above monetary benefits. To say that what they have obtained is an immovable property in exchange or in lieu of the cost of construction incurred by them means not presenting a true and complete picture. The DRC by itself has been sold for a price in the market depending upon demand and supply conditions. Thus, we have no hesitation in holding that this is to be understood as a valuable consideration and equivalent to money. Petition fails and is dismissed - decided against petitioner-assessee.
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