Abb India Limited v. The Commissioner Trade & Taxes

judgment of this Court. The petitioner had entered into contracts with DMRC in the previous reported decision.

¶9Counsel for the revenue on the other hand argued that there are important differences in the nature of the transactions and the scope of the contracts. He highlighted the observations of the OHA that the goods can well be used for purposes other than they were contracted for by the petitioner on the one hand and its customer's i.e. L & T (on behalf of DIAL), BSES Yamuna Power Ltd. and NDPL. In these circumstances, the DVAT Tribunal acted within jurisdiction while directing deposit of a portion of the tax liability. Learned counsel highlighted that substantial relief has been given to the petitioner by the Tribunal. It is further submitted that a substantial amount involved (i.e. `8,00,00,000/-) is in respect of high seas sales, which were never the subject of the Division Bench's ruling, that was ultimately affirmed by the Supreme Court.

¶10This Court has considered the submissions. The Supreme Court in ABB Limited (supra) noted nature of the transaction between the petitioners. The relevant portion of the same is as under:- "17. The aforesaid conclusion leading to our concurrence with the views of the High Court is also based upon the salient facts, particularly the various conditions in the contract and other related covenants between DMRC and the respondent which have been spelt out in paragraph 31 of the High Court judgment (ABB Ltd. Vs. Commr., 2012), enumerated and described as follows: (ABB Ltd. case, SCC OnLine Del) "(1) Specifications were spelt out by DMRC;

(2) Suppliers of the goods were approved by the DMRC;

(3) Pre-inspection of goods was mandated;

(4) The goods were custom made, for use by DMRC in its project;

(5) Excise duty and Customs duty exemptions were given, specifically to the goods, because of a perceived public interest, and its need by DMRC;

(6) The Project Authority Certificate issued by DMRC the name of the subcontractors as well as the equipment/goods to be supplied by them were expressly stipulated;

(7) DMRC issued a Certificate certifying its approval of foreign suppliers located in Italy, Germany, Korea etc. from whom the goods were to be procured.

(8) Packed goods were especially marked as meant for DMRC's use in its project." Before us there was no attempt to assail the aforesaid features and to even remotely suggest any factual error on the part of the High Court in noting those features.

¶18The salient features flowing out as conditions in the contract and the entire conspectus of law on the issues as notice earlier, leave us with no option but to hold that the movement of goods by way of imports or by way of inter-state trade in this case was in pursuance of the conditions and/or as an incident of the contract between the assessee and DMRC. The goods were of specific quality and description for being used in the works contract awarded on turnkey basis to the assessee and there was no possibility of such goods being diverted by the assessee for any other purpose. Hence the law laid down in K.G. Khosla & Co. (P) Ltd. v. CCT, AIR 1966 SC 1216 has rightly been applied to this case by the High Court. We find no reasons to take a different view."

¶11The Revenue is undoubtedly correct in submitting that the DVAT Tribunal has granted significant relief to the petitioners. At the same time, the Court notices that the declaration of law by the Supreme Court was in respect of almost the nature of the transactions as in this case; they do not prima facie differ from the facts that led to the judgment of the Division Bench (as endorsed by the Supreme Court). No significant material particulars were shown to distinguish the two cases.

¶12In the circumstances, this Court is of the opinion that the impugned orders to the extent that they direct the petitioners to deposit 20% of the tax and interest demanded and 10% penalty assessed cannot be sustained. They are accordingly set aside. The Court was informed during the hearing that the DVAT Tribunal, which is seized of the appeals, is likely to hear them on

01.03.2017. In the light of the modifications directed, the DVAT Tribunal shall proceed to hear the appeals on merits and render its decision preferably within three months from today. All rights and contentions of the parties are reserved; nothing stated in this order shall preclude the rights of the parties to urge all contentions. All the petitions are allowed in the above terms. All the petitions and the pending applications are disposed off.

¶13A copy of this order be given dasti to the parties under the signatures of the Court Master.

S. RAVINDRA BHAT, J.

NAJMI WAZIRI, J. FEBRUARY 27, 2017 sb

* IN THE HIGH COURT OF DELHI AT NEW DELHI % Judgment delivered on: 27th February, 2017 + W.P.(C) Nos. 1757/2017, 1758/2017, 1803/2017, 1804/2017, 1805/2017, 1806/2017, 1807/2017, 1808/2017, 1809/2017, 1810/2017, 1811/2017, 1812/2017, 1813/2017, 1814/2017, 1815/2017, 1816/2017, 1817/2017, 1818/2017, 1819/2017, 1820/2017, 1821/2017, 1822/2017, 1823/2017, 1824/2017, 1825/2017, 1826/2017, 1827/2017, 1828/2017, 1829/2017, 1830/2017, 1831/2017, 1832/2017, 1833/2017, 1834/2017, 1835/2017, 1836/2017, 1837/2017, 1838/2017, 1839/2017, 1840/2017, 1841/2017, 1842/2017, 1843/2017, 1844/2017, 1845/2017 & 1846/2017 ABB INDIA LTD ..... Petitioner Through: Mr. R. Jawaharlal, Mr. Siddharth Bawa, Mr. A. K. Bhardwaj, Mr. Manish Hirani and Mr. Shyamal Anand, Advocates. Versus THE COMMISSIONER TRADE & TAXES ..... Respondent Through: Mr. Shadan Farasat and Mr. Ahmed Said, Advocates. CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE NAJMI WAZIRI S. RAVINDRA BHAT (Oral):- CM Nos.7805/2017, 7807/2017, 8005/2017, 8007/2017, 8009/2017, 8011/2017, 8013/2017, 8015/2017, 8017/2017, 8019/2017, 8021/2017, 8023/2017, 8025/2017, 8027/2017, 8029/2017, 8031/2017, 8033/2017, 8035/2017, 8037/2017, 8039/2017, 8041/2017, 8043/2017, 8045/2017, 8047/2017, 8049/2017, 8051/2017, 8053/2017, 8055/2017, 8057/2017, 8059/2017, 8061/2017, 8063/2017, 8065/2017, 8067/2017, 8069/2017, 8071/2017, 8073/2017, 8075/2017, 8077/2017, 8079/2017, 8081/2017, 8083/2017, 8085/2017, 8087/2017, 8089 /2017& 8091/2017 (for exemptions) 1. Allowed, subject to all just exceptions. 2. The applications are disposed off. W.P.(C) No. 1757/2017 & CM No.7804/2017, W.P.(C) No. 1758/2017 & CM No.7806/2017 W.P.(C) No. 1803/2017 & CM No.8004/2017 W.P.(C) No. 1804/2017 & CM No.8006/2017 W.P.(C) No. 1805/2017 & CM No.8008/2017 W.P.(C) No. 1806/2017 & CM No.8010/2017 W.P.(C) No. 1807/2017 & CM No.8012/2017 W.P.(C) No. 1808/2017 & CM No.8014/2017 W.P.(C) No. 1809/2017 & CM No.8016/2017 W.P.(C) No. 1810/2017 & CM No.8018/2017 W.P.(C) No. 1811/2017 & CM No.8020/2017 W.P.(C) No. 1812/2017 & CM No.8022/2017 W.P.(C) No. 1813/2017 & CM No.8024/2017 W.P.(C) No. 1814/2017 & CM No.8026/2017 W.P.(C) No. 1815/2017 & CM No.8028/2017 W.P.(C) No. 1816/2017 & CM No.8030/2017 W.P.(C) No. 1817/2017 & CM No.8032/2017 W.P.(C) No. 1818/2017 & CM No.8034/2017 W.P.(C) No. 1819/2017 & CM No.8036/2017 W.P.(C) No. 1820/2017 & CM No.8038/2017 W.P.(C) No. 1821/2017 & CM No.8040/2017 W.P.(C) No. 1822/2017 & CM No.8042/2017 W.P.(C) No. 1823/2017 & CM No.8044/2017 W.P.(C) No. 1824/2017 & CM No.8046/2017 W.P.(C) No. 1825/2017 & CM No.8048/2017 W.P.(C) No. 1826/2017 & CM No.8050/2017 W.P.(C) No. 1827/2017 & CM No.8052/2017 W.P.(C) No. 1828/2017 & CM No.8054/2017 W.P.(C) No. 1829/2017 & CM No.8056/2017 W.P.(C) No. 1830/2017 & CM No.8058/2017 W.P.(C) No. 1831/2017 & CM No.8060/2017 W.P.(C) No. 1832/2017 & CM No.8062/2017 W.P.(C) No. 1833/2017 & CM No.8064/2017 W.P.(C) No. 1834/2017 & CM No.8066/2017 W.P.(C) No. 1835/2017 & CM No.8068/2017 W.P.(C) No. 1836/2017 & CM No.8070/2017 W.P.(C) No. 1837/2017 & CM No.8072/2017 W.P.(C) No. 1838/2017 & CM No.8074/2017 W.P.(C) No. 1839/2017 & CM No.8076/2017 W.P.(C) No. 1840/2017 & CM No.8078/2017 W.P.(C) No. 1841/2017 & CM No.8080/2017 W.P.(C) No. 1842/2017 & CM No.8082/2017 W.P.(C) No. 1843/2017 & CM No.8084/2017 W.P.(C) No. 1844/2017 & CM No.8086/2017 W.P.(C) No. 1845/2017 & CM No.8088/2017 W.P.(C) No. 1846/2017 & CM No.8090/2017 3. Issue notice. Mr. Shadan Farasat, Advocate accepts notice on behalf of the Revenue. 4. With the consent of the parties, these matters are taken up for hearing. 5. The grievance of the petitioner in all these cases is that the contracts which it entered into with BSES Yamuna Power Ltd., BSES Rajdhani Power Ltd., Delhi International Airport Ltd. (for short "DIAL") and North Delhi Power Ltd. (for short "NDPL") for supply design, manufacturing, erection and commissioning of electrical systems, could not have been taxed under the Delhi Value Added Tax Act, 2004 (for