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TMI Blog2009 (8) TMI 1078X X X X Extracts X X X X X X X X Extracts X X X X ..... articles 14 and 19(1)(g) as well as article 246(2) read with entry 54, List II in the Seventh Schedule read with article 366 of the Constitution of India. Mr. Anturkar, learned counsel appearing for the petitioners, submitted that the grounds of challenge in all the three petitions are common. He took us through the facts stated in Writ Petition No. 496 of 1990 and submitted that decision on that petition would also be applicable to the other two petitions. Mr. Anturkar in fairness invited our attention to a decision of this court in Writ Petition No. 485 of 1990 (Builders Association of India v State of Maharashtra decided on August 25, 1994-Coram: Pendse, J.) [1994] 95 STC 516, wherein the constitutional validity of the Works Contract ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of India Act, 1935 and held that the expression "sale of goods" connotes essential ingredients being an agreement to sell movables for a price and property therein passing pursuant to that agreement. The Supreme Court further held that in a works contract, which is entire and indivisible, there is no sale of goods and no tax could be imposed on the supply of material used in such a contract treating it as a sale. After the decision of the Supreme Court, with regard to the taxability of goods involved in the execution of the works contract, the Law Commission in its 61st Report made a suggestion to insert in article 366 a wide definition of "sale" so as to include works contracts. Keeping in view the recommendations of the Law Commission, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red from a place outside the State where such goods are sold in the same form in which they were purchased, brought or transferred; and (ii) where the goods have been sold in the form other than the form in which they were purchased or, as the case may be, brought or transferred from a place outside the State, then the purchase price of the goods or, as the case may be, the value of the goods brought or transferred from a place outside the State, and so sold." Mr. Anturkar submitted that sub-clause (i) of clause (m) of section 2 of the Works Contract Act, 1989 lays down that in respect of goods brought or transferred by a dealer from a place outside the State, the purchase price of the goods outside the State would be regarded as t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fected outside the State of Maharashtra. In its decision in Builders Association of India v. State of Maharashtra [1994] 95 STC 516, this court has upheld the constitutional validity of the Works Contract Act, 1989 and has held that the Legislature of Maharashtra has a power to impose tax on the value of goods which are transferred by a person to another while executing the works contract. In determining value of the goods as transferred, a dispute may arise as to how the value of goods which have been transferred by a person to another in execution of works contract, is to be determined. The goods property in which is transferred may have been purchased by the dealer/contractor either within the State or from outside the State. While ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1989 only provides the mechanism of determining the value of the goods which have been purchased outside the State and used in a works contract in the State. By doing so, the Legislature has not taxed the sale transaction which has taken place outside the State, but has only provided a mechanism as to how the value of the goods, property in which is transferred by the contractor/dealer in execution of works contract, is to be determined. This definition is introduced to obviate any dispute in ascertaining the price of the goods which form the total turnover of the contractor/dealer. No other point was urged challenging the constitutional validity of the Works Contract Act, 1989. For the reasons stated above, we are of the view that ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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