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TMI Blog2024 (8) TMI 957X X X X Extracts X X X X X X X X Extracts X X X X ..... s an initial transaction whereby the petitioner obtained possession/title of the goods in Kerala from a movement of the goods that originated from outside of Kerala, could not have made a difference while determining the nature of the sale transaction namely inter-State or intra-State . In the instant case, the movement of the goods, in respect of which the petitioner had claimed exemption from tax under the KGST Act, was clearly incidental to their obligations under the contract entered into with KINFRA. The goods themselves were not standard goods but goods that answered to the specifications and make that was prescribed in the contract entered into between the petitioner and KINFRA. Under such circumstances, merely because there was an intervening event that broke the chain of movement of the goods from outside the State to within the State, prior to their incorporation in the works contract, the transaction could not have been viewed as an intra-State sale . These S.T. Revisions allowed by setting aside the impugned orders of the Appellate Tribunal and answering the questions of law raised in these Revision Petitions in favour of the petitioner assessee and against the Revenue. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be treated as deemed inter-State sale of goods in the course of execution of works contract. 4. The claim for exemption was not accepted by the Assessing Authority, who, for the assessment year 2000-01, found that the petitioner had not even discharged the tax liability under the CST Act in respect of purchases effected from sub-vendors from whom it had procured the parts after issuing C Forms. Although the petitioner pointed out that the CST Act had not been amended to make provision for taxation of deemed inter-State sales, the Assessing Authority was of the view that the incorporation of the goods sourced from outside the State, in the works contract in Kerala, would necessarily attract tax under the KGST Act. 5. The petitioner carried the matter in further appeals before the First Appellate Authority and also the Appellate Tribunal, but the said appeals were dismissed. This led the petitioner to approach this Court through the S.T. Revisions aforementioned, wherein the main question of law raised is with regard to the liability to pay tax under the KGST Act on the value of the goods supplied inter-State for execution of the works contract in Kerala. 6. We have heard Sri. Jose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bid or later, shall not relieve the Supplier from any liability or obligation under the Contract. The Contractor shall furnish to the Purchaser/Consultant credentials of the sub-contractor for verification/acceptance. 5. SPECIAL TERMS AND CONDITIONS OR TURNKEY CONTRACT (SCC) (SUPPLY, ERECTION, TESTING COMMISSIONING) 5.1 General 5.1.1 The following special conditions shall be read in conjunction with General terms and conditions of Turnkey Contract (GCC) and amendments/corrections thereto. Where any portion of the GCC are repugnant to or at variance with any provisions of the GCC, then, unless a different intention appears, the provision of the SCC shall be deemed to override the provisions of the GCC only to the extent that such repugnancy, or variations cannot be reconciled with the SCC and shall be to the extent of such repugnancy, or variations, prevail; it being understood that the provisions of GCC shall otherwise prevail. Wherever it is stated anywhere in this contract that such and such work is to be carried out, it shall be understood that same shall be effected/carried out by the Contractor at this own cost, unless a different intention is specifically and expressly stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Engineer-in-charge. 5.5.2 Approved samples shall be retained by the Engineer-in-charge until the completion of the work and all materials and workmanship incorporated in the work are to conform to the approved samples in all respects. Rejected materials shall be removed from the site immediately under the supervision of Engineer-in-charge. 5.5.3 If on handing over the site or at any time thereafter during the execution of work, the contractor considers that any drawing or information necessary for the execution of the work has not been provided, he shall inform the Engineer-in-charge in writing giving full details required. All materials or workmanship, which in the opinion of the Engineer-in-charge is defective or is unsuitable shall be removed immediately from the site within a reasonable time to be fixed by the Engineer-in-charge depending on the requirement in each case, failing which, the same shall be removed at the risk and cost of the Contractor. No claim whatever shall be entertained on this account. 5.5.4 Whenever B.I.S. codes are referred to in other particular specifications attached, the latest B.I.S. codes prevalent at the time of tendering shall be followed. 9. MA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n manufacturing units outside the State and make them available for incorporation in the works contract carried out in the State. It will also be apparent that the goods in question were non-standard goods which had to be in accordance with the designs and specifications supplied by KINFRA. The goods to be supplied were not standard goods which the petitioner company could have fabricated based on its own designs and specifications. It follows therefore that when such goods, as were covered by the contract entered into between the petitioner and KINFRA, were sourced from outside the State, the mere fact that there was an initial transaction whereby the petitioner obtained possession/title of the goods in Kerala from a movement of the goods that originated from outside of Kerala, could not have made a difference while determining the nature of the sale transaction namely inter-State or intra-State . Whether it was goods sourced from a sub-vendor outside the State or goods sourced from their own manufacturing units outside the State, the movement of the goods from outside the State into the State and thereafter till their incorporation in the works contract carried out by the petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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