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TMI Blog2009 (12) TMI 871X X X X Extracts X X X X X X X X Extracts X X X X ..... h as PVC pipes, GI pipes and installation of motor, etc., then rate of tax at compounded rate under section 7(7) is not applicable. On the other hand, if the construction of bore-well involves construction of any room above it or a motor house or the like, the same should be treated as civil construction work on which tax liability could be settled at the compounded rate under section 7(7) of the Act. Since none of the authorities below has considered the above aspects of the matter, which will be clear from the copies of contract, work bills issued by the petitioner and payments approved by the water authority and awarders we allow the revisions by setting aside the order of the Tribunal and remand the matter to the assessing officer fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of construction of bore-well as civil construction work . After hearing both sides, we feel the provisions of tax on works contract cannot be applied to bore-wells in the same way it applies to other wells. A well is normally constructed by digging and removing earth to sufficient depth for collection of water. Digging and removing of earth does not involve supply of any materials and so much so, the digging of well as such does not involve any tax on works contract. The position is the same so far as bore-well is concerned because the difference between ordinary well and bore-well is only on dimension and probably depth. Driving of borewell is a mechanical process and the driller while driving the bore brings out earth and form the bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the nature of work done tax has to be levied at the appropriate rate. In other words, if the materials supplied are not civil construction materials such as PVC pipes, GI pipes and installation of motor, etc., then rate of tax at compounded rate under section 7(7) is not applicable. On the other hand, if the construction of bore-well involves construction of any room above it or a motor house or the like, the same should be treated as civil construction work on which tax liability could be settled at the compounded rate under section 7(7) of the Act. In view of our finding and observations above, and since none of the authorities below has considered the above aspects of the matter, which will be clear from the copies of contract, wor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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