AI Structured Summary
Not yet generated for this judgment
Judgment
K. Raviraja Pandian, J.—By filing this writ petition, the petitioner challenged the assessment order dated 5.2.1999. The petitioner is a Public
Works Department Contractor carrying on building Contract works. Through the enforcement wing of the respondent department, it was brought
to the notice of the assessing officer that the petitioner has constructed building to the Public Works Department and received the amount for
having carried out the construction of the building for the assessment year 1996-97 in a sum of Rs. 7,33,305/-. When the enforcement wing
officers approached the petitioner on 30.9.1997, the petitioner accepted by his statement dated 30.9.1997 that the work has been carried out by
him and the consideration for the same has been received. However, he has not produced any details for the purchase of materials so as to find out
whether the materials purchased by the petitioner has already suffered tax. The regular assessing officer, the fourth respondent herein called upon
the assessee to produce the books of accounts for the purpose of completing the assessment for the year 1996-97 on more than three occasions
by issuance of summons one on 18.5.1998, the second on 23.6.1998 and the last on 6.8.1998. Though all these summons were duly received by
the petitioner, but the petitioner did not respond to the same. Therefore, the assessing officer proposed to complete the assessment on the basis of
the available materials u/s 3(B) of the TNGST Act after allowing due exemption as per the provisions of the Act. A notice dated 18.8.1998
containing the proposal was served on the petitioner on 9.10.1998. In the meanwhile further details about the construction put up by the petitioner
on behalf of Public Works Department during the year 1996-97 for the value of Rs. 3,63,581/- has also come to the knowledge of the assessing
officer. Hence, the assessing officer once again issued a revised pre-assessment notice on 7.12.1998. The petitioner appeared before the assessing
officer and admitted that he is not having accounts for the above construction of the building. He further admitted that he has effected the purchase
of building materials and used the same in the execution of the building works. The Statement was recorded on 30.9.1997. Based on the above
materials, including the statement given by the petitioner and giving details as to the proposal including the penalty to be levied on the petitioner, a
notice dated 19.8.1998 has been issued to the petitioner which has been served on 9.10.1998 and finalised the assessment by imposing a tax u/s
3B of the TNGST Act in a sum of Rs. 80,802. The said amount has been arrived at after giving 30% deduction as per Section 3B of the TNGST
Act, which provides as follows:
Section 3-B Levy of tax on the transfer of goods involved in works contract - (1) Notwithstanding anything contained in Sub-sections (2-B), (3),
(4), (7) and (8) of Section 3, or Section 7-a but subject to the other provisions of this Act including the provisions of Sub-section (1) of Section 3,
every dealer referred to in item (vi) of Clause (g) of Section (2) shall pay, for each, year a tax on his taxable turnover of transfer of property in
goods involved in the execution of works contract at the rates mentioned in Sub-section (2), (2-A) or (2-C) of Section 3, or as the case may be, in
Section 4.
Explanation : - Where any works contract involves more than one item of work, the rate of tax shall be determined separately for each such item of
work.
(2) The taxable turnover of the dealer of transfer of property involved in the execution of works contract shall on and fro the 26th day of June
1986, be arrived at after deducting the following amounts from the total turnover of that dealer:
(a)...
(b)...
(c)...
(d)...
(e) all amounts towards ''labour charges and other like charges'' not involving any transfer of property in goods, actually incurred in connection with
the execution of works contract, or such amounts calculated at the rate specified in column (3) of the Table below, if they are not ascertainable
from the books of accounts maintained and produced by a dealer before the assessing authority.
THE TABLE
Serial Type of works Labour or other charges as
number contract a percentage value of the
works contract
---------------------------------------------------------------
1 Electrical Contracts 15
2 All Structural Contracts 15
3 Sanitary Contracts 25
4 Watch and/or clock repair contracts 50
5 Dyeing contracts 50
6 All other contracts 30
Thus from the facts as narrated above, we find no illegality or irregularity in determining the tax payable by the petitioner in the assessment order.
In addition to the tax so arrived at the assessing officer has also levied penalty u/s 12(3)(b)(v) of the Act, which provides that in addition to the tax
assessed under Sub-section (1) or (2) the assessing authority shall in the same order of assessment passed under Sub-section (1) or (2) or by a
separate order, direct the dealer to pay by way of penalty a sum of one hundred and fifty percent of the difference of the tax assessed and the tax
paid as per the return, if the tax paid as per the return, falls short of the tax assessed on the final assessment by more than seventy five percent.
From the facts narrated above, we are of the view that Clause (v) is not applicable. Section 12(3)(a) provides that where there is failure on the
part of the dealer to submit return, the penalty payable is 150% of the tax assessed and the tax paid. Hence the provision quoted can only be
stated to be not correct. However, in respect of the amount of penalty imposed, there cannot be any difference. It is also well established legal
principle that wrong quoting of the provision cannot be pleaded. For the foregoing reasons, we do not find any reason to grant the relief as prayed
for in this writ petition. The writ petition is dismissed. Consequently, the connected W.P.M.P. is also dismissed. No costs.