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Judgment
Rajes Kumar, J.—These are two revisions against the order of the Tribunal dated December 19, 2008, for the assessment years 2001-02 and 2002-03. The petitioner has been awarded a works contract by IIT, Kanpur for the construction of (i) new lecture hall complex for Rs. 2,25,00,000, (ii) Samtel Centre for Rs. 1,62,34,949 and (iii) Boy''s hostel for Rs. 7,69,73,177. The aforesaid contract also included the electrical works.
The aforesaid contracts have been executed in the assessment years 2001-02 and 2002-03.
In order to arrive to the value of the contract, the value of the electrical works have been separately shown in the contract. However, the case of the applicant is that the contract was one composite indivisible contract for the execution of the aforesaid contract referred hereinabove. All the three contracts were civil in nature.
The applicant applied for. compounding under the compounding scheme u/s 7D of the U.P. Trade Tax Act, 1948. The Compounding in respect of the civil work has been accepted excluding the value determined for electrical works.
Being aggrieved by the orders of the assessing authority, the applicant filed appeals before the Joint Commissioner (Appeals) which have been allowed.
Being aggrieved by the order of the Joint Commissioner (Appeals), the Commissioner of Trade Tax filed appeals before the Tribunal. The Tribunal by the impugned order allowed the appeals of the Commissioner of Trade Tax, set aside the order of the first appellate authority and restored the orders of the assessing authority.
Being aggrieved by the said order, the present revisions have been filed.
The learned counsel for the applicant submitted that the contract was one composite contract for the construction of the aforementioned lecture hall, Samtel centre and boys'' hostel. In each contact, in the scope of work, the aforesaid nature has been described. The composite value has also been mentioned in these contracts. However, for the purposes of determination of the entire value, the value of the electrical work has been shown separately in each contract, but the electrical work was the part of the scope of the composite contracts and therefore, the authorities below have erred in excluding the value of the electrical works from the scope of the entire works which was in the nature of civil work.
Sri B.K. Pandey, learned standing counsel, relied upon the order of the authorities below.
I have considered the rival submissions and perused the impugned order and the copies of the contract.
A perusal of the contracts reveals that in each contract, the scope of the work are mentioned. A composite and consolidated price of the entire work is also mentioned. Only for the purposes of the convenience and for the determination of the value of the entire contracts, the price of the electrical work has been separately shown, though the electrical work was also the part of the main contracts. Therefore, merely because the value of the electrical works was shown separately in the contracts, the same cannot be excluded from the composite value fixed for the entire contracts. The contracts are admittedly civil in nature which also includes the electrical works.
In the circumstances, the Tribunal has erred in excluding the value of the electrical works from the composite value of the contracts which were of a civil nature.
In view of the above, the order of the Tribunal is not sustainable.
The authorities below ate directed to pass a fresh order u/s 7D of the Act, including the value of the electrical works in the civil contract. With the aforesaid observations, both the revisions are allowed.