1) C Forms for purchase of items like tools, plant & machinery equipments vehicles computer etc. for use in execution of works contract – permissible

In case of works contract, articles integral to the process of manufacture such as Tools, Plant & Machinery, Equipment, for example Concrete Mixers, Pumps, Hydraulic Motor Cranes, Vehicles Computers etc. used for preparing Plans, Designs etc., Vehicles used for carrying construction materials etc., and other similar articles would be eligible for concessional rate of tax against Form C even though such goods may not actually be incorporated in execution of the contract.

M/s. Nagarjuna Construction Co. Ltd. v. ACET (Cal. HC) (2016) 67 STA 32.

2) Sale – Supply of canteen services – Meals, snacks and other food articles at agreed price – Sale not as agency

The contract for canteen services to supply meals, snacks and other food articles to the employees of Indian Oil Corporation at agreed concessional price from IOC is a contract of sale liable to vat. This is not a contract of agency as the dealer agreed to undertake the work not for any commission. However, establishment cost paid by IOC to the dealer managing the canteen establishment does not form part of sale price of means and other food articles being paid as separate items of payment.

Usha Ranjan Dutta Gupta v. ACCT & Another, (2016) 67 STA (WBTT).

3) Change in Law – For extending time limit

The cardinal principle which is accepted is that law in force in the assessment year is to be applied unless there is an amendment which comes into force having retrospective operation. In the instant case, the legislature has brought the amendment by reducing the period from eight years to six years from the end of such years or March 31, 2012 whichever is later. The amendment reducing period from eight to six years is beneficial to assessee, however, later part of amendment also specifying the date 31-3-2012 intends to protect interest of revenue in respect of cases within eight and six years provided the reassessments are completed by 31-3-2012 Thus, 2001 amendment is not fully retrospective but it is partly retrospective.

M/s. Commercial Motors v. CTT, UP, (2016) 28 STS 1 (SC).

4) Hydraulic excavator – Machinery or motor vehicles of all kinds

The definition of a particular term in a particular statute is not to be used mechanically for another statute unless it is applicable by necessary implication or otherwise some relevance is shown. In other words machinery is a general term and when some kinds of machineries are separately mentioned they would become ‘special entry’ and shall prevail over the general one. The Hydraulic Excavator may be said to be a ‘Machinery, but when specific entry is there i.e., “motor vehicles of all kinds” an excavator satisfying aforesaid entry will be governed by the same and cannot be taxed by treating it as machinery only.

CCT v. Anand Tyres Jhanji (2016) 28 STJ 20 (All.)

5) Sale price – No undervaluation when bulk sale made to Sahara Airlines much lower price than market value

In case of bulk sale, merely because the sales made to the Sahara Airlines is much lower price than the price at which it is sold at restaurant is not a ground itself that the price is undervalued. The contract is written contract and the amount received is also assessable to income tax and payments are made by cheques. In that view of the matter the view taken by the assessing authority that the sale price is undervalued and that assessing the goods at market value is untenable.

Shri Devendra Sethia v. State of Assam (2016) 28 STJ 34 (Gau.)

6) Recovery of dues of Pvt. Ltd. company in liquidation – Cannot be made from directors personally

In absence of taking any specific recourse to proceedings under Section 18 of The CST Act, 1956 and passing of any valid order for effecting recovery of CST from the director, it is not permissible in law to do so.

Subhash Goyal v. State of Haryana, (2016) 28 STJ 45 (P&H)

7) Lease of cars – Prior to vat Act – No liability under vat Act – Upon rentals received thereafter

The lease of cars for 5 years before enactment of VAT Act and receipt of rentals after VAT Act, no liability under VAT Act on those rentals received during VAT Period. The assessee had a vested right of giving cars on hire and receiving rentals which was not eligible to tax prior to vat Act. Therefore, though assessee continued to receive rentals every month after enactment of vat act, it is in pursuance of a sale which took place prior to vat Act. As no sale has taken place after enactment of Vat Act the liability to pay tax under the VAT Act does not arise.

State of Karnataka v. Lease Plan India Ltd (2016) 28 STJ 65 (Kar.)

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