9911796707
TMI Blog1989 (2) TMI 376X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee in token of acceptance reads as under: "Sub: Award of fabrication and supplying housing elements for 1,000 Nos. houses at Obra. M/s. Hindustan Housing Factory Limited, Jangpura, New Delhi. D/Sir, Your offer No. HHF/DF/4843 dated September 24, 1973 modified vide your letter No. HHF/DF/4842-A dated October 24, 1973 and subsequent discussion for manufacturing and supplying of components for 500 complete houses and for flooring/roofing elements for another 500 houses has been accepted for an amount of Rs. 22,76,382.40 approximately. Your offer has been accepted on the basis of your complete acceptance of general and special conditions as per form A of contract, technical specifications as per IS Codes 6051 (Part-I) 1971, 2185-1967, 1786-1961, 432-1960, 456-1960 drawing, etc., with the following overriding conditions: 1. Rates: Rates quoted are ex-your works near the construction site at Obra including loading into vehicle of the contractor brought inside the works premises. Sales tax, if payable, shall be extra. The condition of insurance charges of your above letter has been withdrawn in your subsequent letter No. HHF/DE/4842-A dated October 24, 1973. 2. Paym ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per R.M. 3.9 M 800 13.75 per R.M. 3.6 M 400 12.70 per R.M. 3.5 M 720 12.70 per R.M. 4.4 M 400 15.15 per R.M. 4.8 M 160 15.15 per R.M. 3.3 M 240 12.70 per R.M. 4.4 M 400 15.15 per R.M. 2.00 M 960 11.00 per R.M. Total 3,35,384.40 ------------ 22,76,382.40 Say 22,76,382.00 (Rupees twenty-two lacs seventy-six thousand three hundred and eighty-two only). Sd...................." The other conditions of the contract so far as relevant were as under: "1. The work is to be carried out at Obra Thermal Project Colony, Obra, Mirzapur. 2.. All items of work shall be executed in strict accordance with the latest relevant ISI Code and according to the specifications laid down by the Executive Engineer, Orba Thermal Civil Construction Division III, U.P. State Electricity Board, Obra, Mirzapur. 3.. If for some reason the Board is unable at any time to issue materials as mentioned hereinafter and the work has to be stopped for want of materials the contractor shall not be entitled to any monetary claim arising out of such circumstances. He shall, however, be granted timelimit extension to the extent of such period as his work remains stopped for want of materia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... med when measurements shall be taken by the Engineer-in-charge. The measurements taken shall be final and binding upon the contractor. 14.. The contractor will have to sign the measurements book in token of acceptance of measurements. If he refuses to sign the same the matter shall be referred to the Engineer-in-charge, whose decision shall be binding on the contractor. 15.. Deleted. 16.. No claim shall be entertained for consideration which is not posted to the Engineer-in-charge under registered cover within 24 hours of the occurrence of the said claim. 17.. The name of authorised agent shall be intimated in writing to the Engineer-in-charge. 18.. The Executive Engineer, Obra, Thermal Civil Construction Division III, Obra, Mirzapur shall be the Engineer of the contract for the proper execution of the contract." The letters sent by the assessee dated 24th September, 1973 and 24th October, 1973 also formed part of the contract entered into between the parties. In their letter dated 24th September, 1973 the assessee has written: "We are pleased to confirm that we will be in position to manufacture and supply precast walling blocks and flooring system ex-our temporary w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The advance payment and recoveries for supply of materials shall be adjusted on pro rata basis in bills against progressive deliveries. 5.. Department assistance.-(i) The contractee will give fairly levelled land of area 2 hectares and of approximately square dimensions (length, breadth not exceeding 1.5). (ii) The contractee will provide as and when available the following accommodation to permanent staff members of HHF posted at site and charge standard rent as applicable to Government undertakings: (a) One quarter Type-III. (b) Two quarters Type-II. (c) Four quarters Type-I. (iii) The contractee shall make available workshop facilities for the repair of plant and machinery of HHF used for proposed construction on reasonable rates. 6.. Inspection.-Inspection of items, if desired, may be made by the contractee in the factory premises, before taking delivery. HHF shall not entertain any claim regarding damages in handling of components subsequently. 7.. Testing.-The testing of representative samples of initial batches of products may be got carried out at HHF site factory. 8.. Modification.-Order, once placed, shall not be cancelled, reduced or modified due to an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in night shifts for the completion of work, whenever necessary. 15.. Subletting.-HHF shall have complete freedom to sublet parts of the work to any contractor of its own choice with prior approval of the contractee." The letter dated 26th October, 1979, the contents of which are reproduced below, was issued by the Executive Engineer, Obra Colony, Civil Maintenance Division-III, U.P. State Electricity Board, to the assessee, which was to form part of the contract: "Subject: Manufacture and supplying prefab components for 1,000 houses in Obra Colony. Dear Sir, As per clause 4 of the conditions of the contract referred to in Award Letter No. 106 OTCCC/C-1/III/HH dated 15th December, 1973 we were to issue the raw materials such as cement, steel aggregate, etc., required for the manufacture of the components required for 1,000 houses to be constructed at Obra. For the purpose of control to ensure proper utilisation of such raw materials made available by us to you, the recovery has been made at the specified (fixed rates mentioned in the conditions referred to above) from various running bills. Further, the property in the raw materials made available for the manufactu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revisions is whether the contract entered into between the assessee and the U.P. State Electricity Board was a contract for sale or a works contract. No hard and fast rule can be laid down as to whether a particular contract is a contract of sale or of works contract but the same has to be judged keeping in view the totality of the terms and conditions of the contract and the relevant circumstances necessitating such contract and the same will depend on the facts and circumstances of each contract entered into between the parties. However, the Supreme Court in various cases has laid down certain tests which are to be applied in deciding the controversy in hand. The distinction between a contract of sale and a contract for work and labour has been pointed out in Halsbury's Laws of England, 3rd Edition, Volume 34, para 3 at page 6 which has been quoted in the order of the Tribunal. The Supreme Court in Ram Singh Sons Engineering Works v. Commissioner of Sales Tax, U.P. [1979] 43 STC 195; 1979 UPTC 548 on the basis of the distinction pointed out in Halsbury's Laws of England came to the conclusion that the primary test is whether the contract is one whose main object is transfer o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ki rikovari nirdharit daron per parishad dwara ki gayi thi. Is prakar rikovari karne ka ek matra ud-deshya yeh tha ki appealkarta housing elements ke nirman mein usi kachche mal ka hi upyog kare tatha apurti kiye gaye kachche mal ka anyatha kahin asthantaran athwa bikri na kar sake. Is prakar parishad dwara diya gaya kachcha mal appealkarta ke pas trust per rakha gaya tha tatha appealkarta ne iski koi kharidari parishad se nahin ki thi. Sabhi prasangik samai per kachache mal ka swamitwa parishad ka hi raha. Apilkarta ne apne visheshagta evam anubhav ke adhar par housing elements ka nirman kiya tha tatha is sambandh mein parishad se kiya gaya anubandh vastav mein labour contract tha." It may be noted that the Tribunal has taken the view that the ownership in the materials for which payment was made or agreed to be made would stand transferred to the assessee as soon as the materials were transferred. It appeared to the Tribunal that the letter dated 26th October, 1979 referred to above mentioning that the property in the raw materials made available for the manufacture of components had all along been vested with the U.P. State Electricity Board, had been brought into existence wi ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
