9911796707
TMI Blog2002 (8) TMI 812X X X X Extracts X X X X X X X X Extracts X X X X ..... 97 an amount of Rs. 63,36,094 claimed by way of deduction by the petitioner-company on account of value of works executed by sub-contractors was disallowed and added to the gross turnover. Another amount of Rs. 35,49,000 being the value of design and engineering in respect of which deduction was claimed by the petitioner-company was also disallowed and the aforesaid amount was similarly added to the gross turnover of the petitioner-company. Apart from the aforesaid two deductions, the entire turnover relating to overseas supplies and services amounting to Rs. 3,74,97,667 was added to the gross turnover and on the basis of the aforesaid computation, the assessing officer determined the tax payable and after deduction of tax already paid, worked out the balance tax payable along with penalty. Aggrieved, the writ petitioner has instituted the present proceedings under article 226 of the Constitution calling into question the aforesaid assessment order dated March 21, 1997. 2.. I have heard Mr. G.K. Joshi, learned Senior Counsel appearing on behalf of the writ petitioner and Mr. B.J. Talukdar, learned counsel appearing on behalf of the Revenue. 3.. An assessment order passed unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tract agreements executed by and between the parties are available on record and so are the documents relating to the import of goods and services pursuant to the contract agreement. The aforesaid imports were made by the Numaligarh Refinery Limited in its own name and under its own importer code number. The imports of the goods into the territory of India were on account of a sale and purchase made pursuant to the contract agreement by and between the parties. Article 286 of the Constitution imposes a fetter on the power of the State to impose a tax on the sale and purchase of goods, where such sale or purchase of goods took place in the course of import of the goods into, or export of the goods out of, the territory of India. In the case of Ben Gorm Nilgiri Plantations Co. reported in [1964] 15 STC 753, the apex Court had laid down the test of integral connection or inextricable link between the sale and the actual import or export to satisfy the requirement of a sale being in the course of the import or export of a particular commodity. The following passage from the judgment of the apex Court in the above case may be usefully extracted hereunder: "A sale in the course of expo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods pertaining to the overseas part of the contract, into India followed the sale pursuant to the agreement between the parties. There is no dispute that the overseas part of the contract of the turnover relating to the aforesaid contract for the assessment period amounted to Rs. 3,74,97,667.00. No dispute has been raised on behalf of the Revenue that the turnover relating to the import of goods pursuant to the contract is not to the extent claimed by the assessee as mentioned hereinabove, i.e., Rs. 3,74,97,667.00 or that the aforesaid turnover needs to be quantified to some other figure. In view of the law enunciated by the apex Court as noticed hereinabove, and in the light of the provisions of article 286 of the Constitution, the aforesaid addition of Rs. 3,74,97,667 to the gross turnover of the petitioner appears to be wholly illegal and unauthorised and the assessment order in so far the aforesaid addition is concerned is liable to be interfered with. 7.. The next ground of challenge against the assessment order dated March 21, 1997 is the disallowance of the claim of deduction of Rs. 36,49,000 from the gross turnover of the assessee, which deduction was claimed by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y disallowing the deduction claimed on the ground that the aforesaid value represents the turnover of work executed through sub-contractors. The assessing officer appears to have reached the conclusion that the assessee would not be entitled to the aforesaid deduction and the amount in question is liable to be added to the turnover of the assessee by relying on the explanation to section 2(38) of the Act to the effect that all contracts including sub-contracts in relation to the same works is to be deemed as a single works contract. The assessee had claimed the aforesaid deduction on the ground that in respect of the works executed through sub-contractors of the value of Rs. 63,36,094, tax at the applicable rate was deducted at source from the bills of the sub-contractors and deposited in the Government treasury. The details of such tax deducted and stated to have been deposited in the treasury were filed before the assessing officer and are also a part of the record of the present proceeding. The assessing officer instead of addressing himself to the aforesaid point at issue, after considering the explanation to section 2(38) of the Act, relied on the communication issued by the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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