ASHWANI KUMAR MISHRA,J. - (1.) The revisionist before this Court claims itself to be a builder and promoter, and is aggrieved by the orders passed by the authorities under the U.P. VAT Act, 2008, in so far as penalty has been imposed upon it under Section 54(1)(7) of the VAT Act, for not securing registration under Section 18(1) of the Act, although the revisionist was performing works contract w.e.f. May, 2013 onwards.
(2.) Facts, giving rise to filing of the present revision, are that the revisionist is a company, registered under the provisions of Indian Companies Act, 1956, and is engaged in the business of development and sale of residential flats. It transpires that in respect of certain plot of land, which belonged to other persons, a builder's agreement was executed between them, which permitted revisionist to undertake work of constructions of flats. Such agreement is said to have been executed in the facts of the present case on 21.6.2012, which was followed with subsequent supplementary agreements. The revisionist pursuant to this agreement came in possession over the land. The revisionist also advertised sale of flats and received money from prospective purchasers. It is not in dispute that allotment letters were issued by the revisionist in May, 2013, and pursuant to such allotment letter, it received instalments from the prospective purchasers. The revisionist thereafter proceeded to raise constructions, and after completing the construction, it has been transferred to the prospective purchasers. The department initiated proceedings against the revisionist on the premise that revisionist had entered into a works contract, pursuant to which constructions had been raised, and in respect of building material utilized for construction, the revisionist was liable to pay tax. It was also held that since the work performed by the revisionist amounted to a works contract, as such, registration under Section 18(1) was warranted before the revisionist could execute words contract. Since the registration has not been obtained, as such, penalty proceedings have been initiated, resulting in passing of the order under challenge. The Tribunal has recorded that registration has been obtained by the revisionist w.e.f. 15th March, 2014, whereas construction work was undertaken pursuant to a works contract executed w.e.f. May, 2013 itself, as such, in respect of such activity undertaken during the period of 11 months, the company is liable to pay penalty amounting to Rs. 31,900/-. This order has been affirmed in appeal and revision. Thus aggrieved, the revisionist has filed the present revision.
(3.) Learned counsel for the revisionist contends that construction work was undertaken by the company out of its own funds, and the funds received from the prospective purchasers was not utilized. Under the Uttar Pradesh Apartment (Promotion of Construction, Ownership and Maintenance) Act, 2010, since the transfer cannot be effected, except by way of a registered conveyance deed, as such, mere entering into an agreement would not invite liability of payment of tax upon the company. The provisions contained under Sections 2(d), 13 and 31 of the Act of 2010 have been relied upon, in order to contend that demand raised by the VAT Authorities is contrary to law.;