9911796707
TMI Blog2012 (3) TMI 388X X X X Extracts X X X X X X X X Extracts X X X X ..... ll the authorities have given a categorical finding that there is a works contract and the transfer of property acquired within the State in the said contract. Further the authorities below are correct in holding that in the absence of separate particulars towards labour charges and the value of property transferred, the provisions of section 3B of the Act were attracted and allowed 30 per cent deduction towards labour charges and only the remaining turnover was chargeable to tax at the appropriate rate. The concurrent findings given by the authorities below are based on valid materials and there is no error or illegality in the order of the Tribunal warranting interference. Thus answer the questions of law as against the assessee and in favour of the Revenue. X X X X Extracts X X X X X X X X Extracts X X X X ..... -87, the assessee was assessed on the total and taxable turnover of ₹ 1,31,26,284 by the assessing officer. Subsequently, the place of business was inspected by the enforcement wing on November 11, 1989. During inspection it was found that the petitioner/assessee had done works contract of repairing the defective compressor received from their customers at Chennai, and also the assessee had received repair charges of ₹ 59,44,585 during the year. Therefore, the assessing officer issued notice. Challenging the notice, the petitioner/assessee had filed a writ petition in W.P. No. 18113 of 1994, before this court and the said writ petition was disposed of on January 22, 1993. In consequence of the disposal of the writ petition, the assessing officer revised the assessment and determined the total taxable turnover at ₹ 1,72,87,493. While determining the turnover, the assessing officer added a sum of ₹ 41,61,209 and treated the transaction as works contract. For both the assessment years, the assessing officer gave relief of deduction at 30 per cent towards labour charges and levied tax at 70 per cent of the turnover in respect of the works contract and levied pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further contended that the Tribunal has disregarded the fact that the sale by appropriation under section 4 of the CST Act took place only in the State of Andhra Pradesh and therefore, the Tribunal is wrong in holding that the sale by appropriation has taken place only in Tamil Nadu and hence, it is liable to tax and hence sought to set aside the order of the Tribunal. The learned Government Advocate appearing for the Revenue contended that the Tribunal is correct in holding that it is a deemed sale and correctly levied tax under section 3B of the Act. Therefore, the finding given by the authorities below is based on valid materials and the revisions are liable to be dismissed. Heard the learned counsel appearing on either side and perused the materials available on record. The petitioner/assessee is the manufacturer of compressors and the said compressor is an important component in the air-conditioner/refrigerator. The petitioner/assessee supplied refrigerators to the customers. There is no factory with repairing facility within the State of Tamil Nadu. The defective compressors were brought to the petitioner for repairs. When the defective compressor is handed over, a rectif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her particulars given to us during the hearing, the process employed by them was as follows: (i) The outer shell of the compressors was cut open. (ii) The inner components of the compressors were then dismantled piece by piece. (iii) The individual parts so obtained were sent to the respective sections in which similar new parts were manufactured. In these sections the received parts were tested and repaired. Irreparable parts were rejected and were replaced by new parts. (iv) After such testing/repairs/replacements, the parts were brought back to a separate repair assembly line set up in 1971. Here, the parts were re-assembled to make a compressor. (v) In about 60 per cent cases, bottom shells of the returned compressors required replacement. Serial number of the compressor is engraved on the bottom shell. So, when the bottom shell itself was replaced, serial number of the returned compressor was re-engraved on the new bottom shell of the re-assembled compressor with a prefix R (to denote repair). In the remaining 40 per cent or so cases, where bottom shells were not replaced, the serial number was nevertheless re-engraved with the prefix R since the original engraving became ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clear that the whole transaction forms part of an implied contract for repair of the defective compressor in the State. It is only a replacement with a re-conditioned compressor of the same model instead of a defective compressor. Therefore, the authorities below are correct in coming to the conclusion that there is no contract for sale of compressors. Therefore, the transaction has to be treated only as works contract. The reconditioned compressors are handed over and the defective compressors were received by the assessee after charging repair charges and the whole transaction is within the State. After considering the nature of the transaction, all the authorities have given a categorical finding that there is a works contract and the transfer of property acquired within the State in the said contract. Further the authorities below are correct in holding that in the absence of separate particulars towards labour charges and the value of property transferred, the provisions of section 3B of the Act were attracted and allowed 30 per cent deduction towards labour charges and only the remaining turnover was chargeable to tax at the appropriate rate. The concurrent findings given by ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
