JUDGMENT The judgment of the Court was delivered by M. SRINIVASAN, C.J. - I. Introduction : In these writ petitions, the constitutional validity of section 12-A of the Himachal Pradesh General Sales Tax Act, 1968 (hereinafter referred to as "the Act") and rule 31-A of the Himachal Pradesh General Sales Tax Rules, 1968 framed thereunder (hereinafter referred to as "the Rules") is challenged. II. Facts : 2. The facts in all these cases excepting C.W.P. No. 63 of 1996 are similar. The petitioners claim to carry on business of implementation and execution of electric projects for the generation and distribution of electricity. Excepting the petitioner in C.W.P. No. 63 of 1996, the petitioners were awarded "works contract" for the construction of civil work for different parts by M/s. Nathpa Jhakri Power Corporation Ltd., New Delhi, to be executed within the State of Himachal Pradesh. In C.W.P. No. 1839 of 1993, it is for Pressure Shafts and Power House Complex. In C.W.P. No. 199 of 1994, it is for dam, intake and desalting chambers as well as head race tunnel from station 0.0 m to 16042 m including sholding works. In C.W.P. No. 208 of 1994 it is for head race tunnel from station 16042 m to 27295 m including surge shaft. In C.W.P. No. 152 of 1995 the contract was for construction of main concrete dam and coffer dams at Camera Hydro-Electric Project. According to the petitioner, the works were executed and handed over to the contractee and claims were also submitted for payment. In C.W.P. No. 63 of 1996, the petitioner was awarded a works contract for the implementation and execution of 300 M. W. Baspa Hydro Electric Project Stage-II in Kinnaur District by the Government of Himachal Pradesh. 3. Though there are some differences in the contentions raised in the pleading, the arguments advanced by learned Senior Counsel for the petitioners in all the cases are the same. There is no dispute that the petitioners are dealers as defined by section 2(c) of the Act. It is also not in dispute that by the execution of the works contracts, the petitioners would be transferring the property in goods involved in the execution of the contracts either in full or in the goods as such and the said transfer will fall within the ambit of word "sale" as defined in section 2(f) of the Act. It is also not in dispute that by the execution of the works contracts, the petitioners would be transferring the property in goods involved in the execution of the contracts either in full or in the goods as such and the said transfer will fall within the ambit of word "sale" as defined in section 2(f) of the Act. The validity of no other section in the Act is challenged. III. Impugned section and the Rules : 4. The impugned section 12-A was introduced in the Act by the State Act No. 18 of 1991. The section reads as follows : "12-A(1). Notwithstanding anything to the contrary contained in section 13, every person making any payment or discharge of any liability on account of valuable consideration payable for the transfer of property in goods, whether as goods or in some other form, involved in the execution of works contract shall deduct an amount not exceeding four percentum, as may be prescribed, purporting to be a part or full of the tax payable on such sales, from the bills or invoices raised by the works contractor as payable by the person : Provided that no such payment or discharge of any bill raised by the works contractor shall be made without deduction : Provided further that if the State Government is satisfied that it is necessary to do so in the interest of the State revenue, it may notify the names/posts of such persons who shall be competent persons to make such deduction. (2) The deduction referred to in sub-section (1) shall be made in the manner which may be prescribed. (3) The payment of such deduction into the Government treasury shall be the responsibility of the person making such deduction. (4) The person making such deduction shall issue deduction certificate in the prescribed manner to the person or dealer from whose bill or invoice such deduction has been made. (5) If any person contravenes any or all of the provisions of sub-sections (1), (3) and (4) the prescribed authority shall, after giving an opportunity of being heard, by an order, in writing, direct that such person shall pay by way of penalty, a sum not exceeding twice the amount of tax deductible under sub-section (1). (5) If any person contravenes any or all of the provisions of sub-sections (1), (3) and (4) the prescribed authority shall, after giving an opportunity of being heard, by an order, in writing, direct that such person shall pay by way of penalty, a sum not exceeding twice the amount of tax deductible under sub-section (1). (6) The provisions of sections 16 and 16-A for recovery of any amount of tax due from a dealer shall mutatis mutandis apply for recovery of any amount of tax, deducted and/or any penalty imposed but not deposited under this section." 5. By notification Shimala-171002, the 31st July, 1993, rule 31-A was inserted after rule 31 of the Rules. The said rule 31-A reads as follows : "31-A. Deduction of tax from the bills/invoices of works contractor. - (1) For the purpose of section 12-A of the Act, every person in a department of any Government, a corporation, Government undertaking, a co-operative society, a local body, a trust or a private or public limited company or any other concern responsible for making any payment or discharge of any liability on account of valuable consideration payable for the transfer of property in goods whether as goods or in some other form, involved in the execution of works contract or for carrying out any works, shall at the time of - (i) payment thereof in cash or by issue of a cheque or bank draft or any other mode; or (ii) credit of such sum to the account of the works contractor; or (iii) discharging liability on account of the said valuable consideration to the works contractor, deduct an amount equal to two per centum of such sum towards the tax under section 12-A of the Act. (2) The deduction under sub-rule (1) shall be made from all payments being made in respect of all works contract executed, whether in part or in full. (3)(i) The person making tax deduction of tax under sub-section (1) of section 12-A of the Act and responsible for making payment of such deduction into the Government treasury under sub-section (3) of the said section shall pay into Government treasury all the amounts deductible by him during a month, on or before the 15th day of the month following the month to which the deduction relates. (ii) The payments under sub-rule (3) shall be made in respect of each works contractor in challan in form S.T. XI-A obtainable free of charge at the District Excise and Taxation Offices and subordinate offices thereto. (iii) The challan in form S.T. XI-A shall be filled in quadruplicate in respect of each works contractor. The copy of the challan marked as "Duplicate" shall be retained by the treasurer, the copy marked as "Original" shall be sent by the Treasury Officer to the Assistant Excise and Taxation Commissioner or Excise and Taxation Officer, Incharge of the district and the copies marked as "Triplicate" and "Quadruplicate" shall be returned to the person making payment of the tax deducted. (4)(i) Every person deducting tax in accordance with sub-section (1) of section 12-A, at the time of making payment, by any mode, shall issue to the works contractor from whom such deduction is made a deduction certificate in form S.T. XI-B and furnish fully and correctly all particulars as are prescribed therein. (ii) The certificate in form S.T. XI-B shall be in quadruplicate. (iii) The portions of marked "Original" certificate in form S.T. XI-B and "Duplicate" shall be handed over to the works contractor, from whose bills/invoices payment deduction has been made. The "Original" portion shall be furnished by the works contractor to the appropriate assessing authority as an evidence of payment of tax by deduction to source along with the return to be filed by him under section 12 of the Act and the "Duplicate" portion shall be retained by the works contractor. (iv) The "Triplicate" portion shall be sent to the appropriate assessing authority along with the one copy of the treasury challan in form S.T. XI-A and the quarterly return prescribed in sub-rule (5). (iv) The "Triplicate" portion shall be sent to the appropriate assessing authority along with the one copy of the treasury challan in form S.T. XI-A and the quarterly return prescribed in sub-rule (5). (v) The "Quadruplicate" portion shall be retained by the person issuing the certificate in form S.T. XI-B. (5)(1) Every person making deduction under sub-section (1) of section 12-A of the Act and who is responsible for depositing the amount of such deduction in the Government treasury under sub-section (3) of the said section shall also send a return in form S.T. XI-C to the Assistant Excise and Taxation Commissioner or Excise and Taxation Officer, Incharge of the district quarterly within 30 days from the expiry of each quarter in respect of the deductions made by him during the quarter immediately preceding along with the certificate and treasury challan as required in clause (iv) of sub-rule (4) and clause (ii) of sub-rule (3). (6) Any deduction made in accordance with the provisions of sub-section (1) of section 12-A of the Act and paid into the Government treasury in accordance with this rule shall be treated as payment of tax on behalf of the works contractor from whom such deduction was made and credit shall be given to him under rule 26 for the amount so deducted or deposited into the Government treasury : Provided that for the purpose of rule 26, if the amount of tax payable as per return in form S.T. VIII or form S.T. IX, as the case may be, exceeds the amount shown in the treasury challan in form S.T. XI-A and in the certificate in form S.T. XI-B, the works contractor shall make the payment of the balance amount of tax remaining unpaid for the period for which such return is filed, failing which such works contractor will not be deemed to have made the payment in accordance with the provisions of sub-section (4) of section 12 of the Act." 6. By the same notification, rule 38 was substituted by the following : "38(1) After considering any objection made by the dealer and any evidence produced in support thereof, the assessing authority after giving the dealer an opportunity of being heard, shall assess the amount of tax and interest, if any, and impose penalty, if any, to be paid by the dealer. (2) In case of a works contract, tax shall be assessed on the "taxable turnover" of the works contractor after deducting all sums towards labour charges, other than any sum on account of labour charges includible in the "turnover" of a dealer under clause (m) of section 2 of the Act, which are directly co-related with the goods, property in which has passed in the execution of works contract, whether as goods or in some other form : Provided that where the labour charges, are not determinable from the accounts of the works contractors, or are considered unreasonably high considering the nature of the contract, the deductions towards labour charges shall be allowed by the assessing authority according to the limits prescribed in column 3 for the type of contract specified in column 2 of the table given below : TABLE ------------------------------------------------------------------------ Sl. No. Type of contract Labour charges at percentage of the value of the contract. (1) (2) (3) ------------------------------------------------------------------------ 1 Fabrication and installation of plant and 25 machinery 2 Fabrication and creation of structural works of 15 iron and steel including fabrication, supply and creation of iron trusses, purlines, etc. 3 Fabrication and installation of cranes and joists. 15 4 Fabrication and installation of elevators (lifts) 15 and escalators. 5 Fabrication and installation of rolling shutters 15 and collapsible gates. 6 Civil works like constructions of building, bridges 25 roads/dams, barrages, canal and diversions. 7 Installation of doors, door frames, windows, frames 20 and grills 8 Supply and fixing of tiles, slabs, stones and sheets 20 9 Supply and installation of air-conditioning 15 equipments including deep freezers, cold storage plants, humidifications plant and dehumidor. 10 Supply and installation of air-conditioners and 15 air-coolers. 11 Supply and fitting of electrical goods, supply and 15 installation of electrical equipments including transformers. 12 Supply and fixing of furnitures and fixtures, 20 partitions including contracts for interior decoration and false ceiling. 13 Construction of railway coaches and wagons on under 20 carriages supplied by railway. 14 Construction or mounting bodies of motor vehicles 20 and constructions of trailers. 15 Sanitary fitting for plumbing and drainages or 25 sewerage. 16 Laying underground or surface pipe lines, cables 30 or conductors. 17 Dyeing and printing of textiles. 30 18 Supply and erection of weighing machines and 15 weigh bridges. 19 Painting, polishing and white-washing. 14 Construction or mounting bodies of motor vehicles 20 and constructions of trailers. 15 Sanitary fitting for plumbing and drainages or 25 sewerage. 16 Laying underground or surface pipe lines, cables 30 or conductors. 17 Dyeing and printing of textiles. 30 18 Supply and erection of weighing machines and 15 weigh bridges. 19 Painting, polishing and white-washing. 30 20 All other contracts not specified from serial 25 Nos. 1 to 19 above. ------------------------------------------------------------------------ Provided further that assessing authority shall not allow any deduction towards labour charges unless the works contractor has specifically preferred the claim therefor and unless such claim is found by the assessing authority to be proper and justified in each case." IV. Contentions : 7. The arguments of Sri Gopal Subramaniam are that the said section provides for a levy and collection of tax contrary to the charging section in the Act, namely, section 6. According to him, section 12-A is also a charging section in one sense of the term as it enables levy and collection of tax on sales expressly excluded from the purview of tax under section 6 of the Act. Alternatively, it is argued by him that even if the section could be treated only as a provision for collection of tax or deduction of tax at source similar to the provisions in section 194-C of the Income-tax Act, 1961, the section is unconstitutional as there cannot be a provision for collection of any amount as tax on amounts which are not taxable at all. According to him, any provision for collection of tax must at the outset exclude non-taxable item and in the absence of such exclusion it will be violative of article 265 of the Constitution of India. It is contended that the provision for collection must be commensurate and in consonance with the charging section. In other words, the taxability of the amount is a sine qua non of the provision for collection of tax whether it be in advance before the assessment or later after the assessment. 8. It is contended that the provision for collection must be commensurate and in consonance with the charging section. In other words, the taxability of the amount is a sine qua non of the provision for collection of tax whether it be in advance before the assessment or later after the assessment. 8. Sri Jaitley appearing in C.W.P. No. 208 of 1994 has contended that even if section 12-A is not considered to be a charging section but treated only as providing a machinery for collection of tax in advance, it is unconstitutional as there is no provision enabling the dealer to get a certificate of non-taxability or exemption on the footing that no tax will at all be payable by such dealer. Reference is made by him to clause (iii) of clause (a) of sub-section (3) of section 6 of the Act which provides that sales to any undertaking supplying electrical energy to the public under a licence or sanction under the Indian Electricity Act, 1910, of goods for use by it in the generation or distribution of such energy and the proviso to the said clause which enables the dealer to get a declaration from the authorised officer of such undertaking and furnish to the assessing authority. It is also argued by him alternatively that the doctrine of reading down should be applied in the case and on a harmonious construction of section 6(3)(a)(iii) and section 12-A, it should be held that none of the petitioners is liable for payment of tax under the Act and consequently there shall be no deduction of any amount from their bills submitted to the contracting party which is an electrical undertaking contemplated in section 6(3)(a)(iii). It is further contended that in any event, rule 31-A should be either struck down as invalid or read down in such a manner that the petitioners and dealers like them are not made to suffer deduction of a percentage from the amount due to them for the work done by them. V. Historical background : 9. In order to appreciate the contentions of the petitioners and the true scope of the impugned section and the rule, it is necessary to refer to the relevant constitutional provisions and some rulings of the Supreme Court. V. Historical background : 9. In order to appreciate the contentions of the petitioners and the true scope of the impugned section and the rule, it is necessary to refer to the relevant constitutional provisions and some rulings of the Supreme Court. Entry 54 in List II of the Seventh Schedule to the Constitution empowers the State Legislature to levy taxes on sale or purchase of goods other than newspapers subject to the provisions of entry 92-A of List I which relates to sale or purchase taking place in the course of inter-State trade or commerce. 10. In several States a controversy arose about the liability of contractors who had undertaken to carry out works contracts to pay sales tax on the transfer of property in the goods involved in such contracts. In State of Madras v. Gannon Dunkerley & Co. (Madras) Ltd. [1958] 9 STC 353 (SC); AIR 1958 SC 560 , the Supreme Court held that on a true interpretation, the expression "sale of goods" meant an agreement between the parties for the very goods in which eventually property passed and that in a building contract where the agreement was that the contractor should construct the building according to the specifications contained in the agreement and in consideration therefor he received payment as provided therein, there was neither a contract to sell the materials used in the construction nor the property passed therein as movables. The court also held that in a building contract which was one, entire and indivisible, there was no sale of goods and it was not within the competence of the State Legislature to impose a tax on the supply of the materials used in such a contract treating it as a sale. 11. In order to solve the problems which arose on account of the aforesaid decision, the Constitution of India was amended. By the 46th Amendment a new clause (29A) was introduced in article 366 of the Constitution by which the expression "tax on the sale or purchase of goods" was defined to include, inter alia, "a tax on the transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract". The constitutional validity of the 46th Amendment was challenged in Builders Association of India v. Union of India [1989] 73 STC 370; (1989) 2 SCC 645 . The constitutional validity of the 46th Amendment was challenged in Builders Association of India v. Union of India [1989] 73 STC 370; (1989) 2 SCC 645 . The Supreme Court while upholding the validity of the 46th Amendment declared that the sales tax laws passed by the Legislatures of States levying taxes on the transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract are subject to the restrictions and conditions mentioned in each clause or sub-clause of article 286 of the Constitution of India. It is to be noted that the court rejected the contention of the States that the properties transferred in the execution of a works contract are not the goods involved in the execution of the works contract but a conglomerate, that is, the entire building that is actually constructed and held that after the 46th Amendment it was not possible to accede to the plea of the States that what is transferred in a works contract is the right in the immovable property. 12. Pursuant to the said decision of the Supreme Court, fresh writ petitions were filed in the High Court of Rajasthan challenging the validity of the provisions of the Rajasthan Sales Tax Act, 1954 and the Rajasthan Sales Tax Rules, 1955 relating to imposition of tax on transfer of property in goods involved in the execution of a works contract. They were dismissed by the High Court and appeals were filed in the Supreme Court. The judgment of the Supreme Court is reported in Gannon Dunkerly & Co., v. State of Rajasthan [1993] 88 STC 204; (1993) 1 SCC 364 . After an exhaustive discussion of the law on the subject the court set out the following conclusions : "(1) In exercise of its legislative power to impose tax on sales or purchase of goods under entry 54 of the State List read with article 366(29A)(b), the State Legislature, while imposing a tax on the transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract is not competent to impose a tax on such a transfer (deemed sale) which constitutes a sale in the course of inter-State trade or commerce or a sale outside the State or a sale in the course of import or export. (2) The provisions of sections 3, 4 and 5 and sections 14 and 15 of the Central Sales Tax Act, 1956, are applicable to a transfer of property in goods involved in the execution of a works contract covered by article 366(29A)(b). (3) While defining the expression 'sale' in the sales tax legislation it is open to the State Legislature to fix the situs of a deemed sale resulting from a transfer falling within the ambit of article 366(29A)(b) but it is not permissible for the State Legislature to define the expression 'sale' in a way as to bring within the ambit of the taxing power a sale in the course of inter-State trade or commerce, or a sale outside the State or a sale in the course of import and export. (4) The tax on transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract falling within the ambit of article 366(29A)(b) is leviable on the goods involved in the execution of a works contract and the value of the goods which are involved in the execution of works contract would constitute the measure for imposition of the tax. (5) In order to determine the value of the goods which are involved in the execution of a works contract for the purpose of levying the tax referred to in article 366(29A)(b), it is permissible to take the value of the works contract as the basis and the value of the goods involved in the execution of the works contract can be arrived at by deducting expenses incurred by the contractor for providing labour and other services from the value of the works contract. (6) The charges for labour and services which are required to be deducted from the value of the works contract would cover (i) labour charges for execution of the works, (ii) amount paid to a sub-contractor for labour and services; (iii) charges for obtaining on hire or otherwise machinery and tools used for execution of the works contract, (iv) charges for planning, designing and architect's fees, and (v) cost of consumables used in the execution of the works contract, (vi) cost of establishment of the contractor to the extent it is relatable to supply of labour and services, (vii) other similar expenses relatable to supply of labour and services, and (viii) profit earned by the contractor to the extent it is relatable to supply of labour and services. (7) To deal with cases where the contractor does not maintain proper accounts or the account books produced by him are not found worthy of credence by the assessing authority the Legislature may prescribe a formula for deduction of cost of labour and services on the basis of a percentage of the value of the works contract but while doing so it has to be ensured that the amount deductible under such formula does not differ appreciably from the expenses for labour and services that would be incurred in normal circumstances in respect of that particular type of works contract. It would be permissible for the Legislature to prescribe varying scales for deduction on account of cost of labour and services for various types of works contract. (8) While fixing the rate of tax it is permissible to fix a uniform rate of tax for the various goods involved in the execution of a works contract which rate may be different from the rates of tax fixed in respect of sales or purchase of those goods as a separate article." 13. After settling the law thus the court proceeded to consider the provisions of the Rajasthan Sales Tax Act and Rules. Pointing out that the charging section 5(3) made a departure from the other provisions inasmuch as in the case of a works contract the tax was to be levied on the turnover of such contract and not on the taxable turnover as provided in sub-section (1) of section 5 in respect of other sales. Pointing out that the charging section 5(3) made a departure from the other provisions inasmuch as in the case of a works contract the tax was to be levied on the turnover of such contract and not on the taxable turnover as provided in sub-section (1) of section 5 in respect of other sales. The court found that in section 5(3) the legislature had enlarged the field of taxability to permit tax being levied on sales in the course of inter-State trade or commerce, sales outside the State and sales in the course of import and export and to ignore the conditions and restrictions imposed by section 15 of the Central Sales Tax Act, 1956. The court pointed out that the constitutional validity of a statute has to be determined on the basis of its provisions and on the ambit of the operation as reasonably construed and if so judged, it does not pass the test of constitutionality, it cannot be pronounced valid merely because it is administered in a manner which does not conflict with the constitutional requirements. Consequently, the court struck down section 5(3) of the Act and rule 29(2)(i) as unconstitutional. 14. On the same day on which the above judgment was delivered, the same Bench pronounced another judgment in a case arising from the State of Karnataka, viz., Builders' Association of India v. State of Karnataka [1993] 88 STC 248 (SC); (1993) 1 SCC 409 , wherein the validity of the Karnataka Sales Tax Act and Rules was challenged. Applying the principles laid down in the Rajasthan case, the court upheld the validity of the Karnataka Act. The court pointed out that in the charging section 5-B, the tax is imposed on the taxable turnover of transfer of property in goods involved in the execution of works contract. Referring to the definition of "taxable turnover" and the relevant Rules, the court observed that the tax was not levied on the value of the works contract and that the taxable turnover on which tax is leviable is arrived at after deducting from the value of the works contract the expenses which are incurred by the contract towards labour charges and other expenses including amounts paid to sub-contractors. The contention that in fixing the situs of the sale under clause (c) of Explanation 3 to section 2(t), the Legislature converted an inter-State sale or sale outside the State into an inside sale and thereby acted beyond its legislative competence was rejected by the court by reading clause (c) in the light of clauses (a) and (b) of the said Explanation. The court also upheld the fixation of the percentage on account of labour and other charges in cases where the amount actually incurred towards such charges were not ascertainable from the books of account maintained and produced by a dealer before the assessing authority. The court also upheld the prescription of different rates of tax for particular types of works contract and rejected the argument that the same violated article 14 of the Constitution of India. 15. It must be mentioned here that in the Rajasthan case, section 7(2)(c) and rule 46(2) are similar to section 12-A of the Act and rule 31-A of the Rules impugned in this case. The challenge to the validity thereof was not considered by the court as the charging section 5(3) was struck down in that case. In the Karnataka case, the question relating to the validity of section 19-A of the Karnataka Act, which is similar to section 12-A herein was raised for the first time in the course of arguments and the court refused to permit the appellant to raise the question. Thus, in the two cases referred to above, the question similar to the one which we are now considering was not decided. VI. Analysis of the sections and the Rules. 16. Now, we shall scrutinise the provisions of the Act and the Rules. Section 2(c) defines "dealer". Under clause (iv)(b) thereof, every person engaged in the business of "transfer of property in goods (whether as goods or in some other form) involved in the execution of works contract is included. Section 2(h) defines "purchase" as inclusive, inter alia, of the transfer of property in goods (whether as goods or in some other form) involved in the execution of works contract. Similarly section 2(j) includes in the definition of "sale" the transfer to property in goods involved in the execution of works contract. Section 2(h) defines "purchase" as inclusive, inter alia, of the transfer of property in goods (whether as goods or in some other form) involved in the execution of works contract. Similarly section 2(j) includes in the definition of "sale" the transfer to property in goods involved in the execution of works contract. Section 2(m) defines "turnover" as follows : "'turnover' includes the aggregate of the amounts of sales and purchases and parts of sales and purchases actually made by any dealer during the given period less any sum allowed as cash discount according to ordinary trade practice, but including any sum charged for anything done by the dealer in respect of the goods at the time of, or before, delivery thereof. Explanation. - (1) The proceeds of any sale made outside Himachal Pradesh by a dealer, who carries on business both inside and outside Himachal Pradesh, shall not be included in the turnover; (2) to (4)........... (5) The amount to be included in the turnover in respect of transfer of property in goods (whether as goods or in some other form) involved in the execution of works contract shall be its sale price." 17. Section 4 sets out the incidence of taxation. Sub-sections (1) and (6) thereof read as follows : "(1) Subject to the provisions of section 6, section 7 and sub-section (2) of section 12, every dealer (except one dealing exclusively in goods declared tax-free under section 7) whose gross turnover during the year immediately preceding the commencement of this Act exceeded the taxable quantum shall be liable to pay tax under this Act on all sales effected and purchases made after the coming into force of this Act. (6) In this Act, the expression "taxable quantum" means : (a) in relation to any dealer who imports for sale or use in manufacturing or processing any goods in Himachal Pradesh, Nil; (b) in relation to any dealer, who himself manufacturers or produces any goods for sale, 40,000 rupees; (c) in relation to any dealer, who runs a hotel, restaurant, bakery or other similar establishment wherein food preparations including tea, are served, 1,00,000 rupees; (d) in relation to any particular class of dealers not falling within clauses (a), (b) and/or (c), such sum as may be prescribed; or (e) in relation to any other dealer, 3,00,000 rupees : Provided that the registration of dealers already registered under this clause shall not be cancelled until their turnover in each of three consecutive years does not entitle them to cancellation under clause (b) of sub-section (6) of section 8." 18. Section 5 provides that a dealer registered under the Central Sales Tax Act, 1956 who is not liable to pay tax under section 4 shall nevertheless be liable to pay tax under the Act on any sale or purchase made by him inside the State and the proviso declares that nothing therein shall apply to a dealer who deals exclusively in goods declared tax-free under section 7. 19. Section 6 is the charging section. Sub-section (1) reads thus : "(1) Subject to provisions of this Act, there shall be levied on taxable turnover of a dealer a tax at such rates not exceeding ten paise in a rupee as the Government may, by notification, direct : Provided that a tax at such rate not exceeding 15 paise in a rupee, as may be so notified, may be levied on the sale of goods as specified in Schedule 'A' except on items 25 and 34 thereof on which a tax at the rate not exceeding 30 paise in a rupee shall be levied. The Government, after giving by notification, not less than thirty days notice of its intention so to do, may, by like notification, add to or delete from this Schedule, and thereupon this Schedule shall be deemed to have been amended accordingly : Provided further that the rate of tax in respect of all declared goods, shall, unless a lower rate is fixed by the Government, by notification, be the maximum rate specified in clause (a) of section 15 of the Central Sales Tax Act, 1956 : Provided further that in the case of goods specified in Schedule 'C', the tax shall be leviable and payable on the purchase thereof." Sub-section (3) defines "taxable turnover" as that part of dealer's gross turnover during any period which remains after deducting therefrom his turnover on sales and purchases referred to therein. Sub-clause (iii) of clause (a) reads as follows : "(iii) sales to any undertaking supplying electrical energy to the public under a licence or sanction granted or deemed to have been granted under the Indian Electricity Act (9 of 1910), of goods for use by it in the generation or distribution of such energy : Provided that in the case of such sales, a declaration in such form and in such manner as may be prescribed, duly filled and signed by the authorised officer of such undertaking to whom the goods are sold is furnished to the assessing authority by the dealer who sells the goods." Sub-clause (iv) refers to sales or purchase of goods falling under section 41, which in turn excludes from the ambit of taxation under the Act inter-State sales and sales outside the State and sale or purchase in the course of import or export of goods into or out of the territory of India. 20. Thus, the charging section excludes transactions in respect of which the State Legislature will have no competence to levy tax. As pointed out already, the attack in this case is only against section 12-A and rule 31-A. A reading of section 12-A shows that it is not a charging provision. It does not seek to impose or levy tax on any transaction by itself. It provides only for deduction of certain amount from the bills or invoices raised by the works contractor. We have already extracted the sections in full in para 4. It does not seek to impose or levy tax on any transaction by itself. It provides only for deduction of certain amount from the bills or invoices raised by the works contractor. We have already extracted the sections in full in para 4. The crucial words of the sections are "payment or discharge of any liability on account of valuable consideration payable for the transfer of property in goods whether as goods or in some other form involved in the execution of works contract". Thus, the relevant amount is the valuable consideration payable for the transfer of property in goods and not the entire value or consideration for the entire works contract. What is directed to be deducted is only an amount not exceeding four per centum as may be prescribed purporting to be a part or full of the tax payable on such sales. The word "such" is very significant. It refers to the "transfer or property in goods" mentioned in the earlier part of section. The expression "tax payable" would necessarily mean tax payable under the charging provisions of the Act. The section uses also the expression "purporting to be". That also shows that what is deducted is not the tax itself, but an amount purporting to be tax. Further, the section refers to bills or invoices raised by the contractor. Hence, the section contemplates the consideration payable for the transfer of property in goods as per the bills and invoices raised by the works contractor. It is, therefore, very clear that the section does not provide for levy or imposition of any tax in addition to or in lieu of the tax payable under the charging section, namely, section 6. By no stretch of imagination, the section can be considered to be a charging section as contended by learned counsel. 21. Learned counsel has drawn our attention to section 13, which prohibits collection of tax in respect of sale or purchase of any goods on which no tax is payable under the Act and the non obstante clause in the beginning of section 12-A. According to him, while section 13 is in accord with article 265 of the Constitution of India, section 12-A violates the same on account of the non obstante clause. In other words, learned counsel contends that section 12-A enables collection of tax in respect of sale or purchase of any goods on which no tax is payable under the Act. There is no merit whatever in the contention. As pointed out already, section 12-A provides only a machinery for collection in advance before assessment of tax payable under the Act. We have no hesitation to hold that the section does not suffer from the vices found in the Rajasthan Act by the Supreme Court in Gannon Dunkerley case [1993] 88 STC 204; (1993) 1 SCC 364 . The tests laid down by the court in that case are satisfied in the present case and we hold that the State Legislature has not exceeded its competence in enacting section 12-A. The section is in no way unconstitutional. 22. Now, we turn to rule 31-A. We have already extracted the Rule in toto in para 5. Sub-rule (1) of the Rules sets out the list of person who shall deduct an amount as required by section 12-A. Obviously, that part of the Rule falls within the second proviso to the section. The Rule prescribes the per centum to be deducted as required by the section. The crucial part of the section is repeated in the Rule. That is, the words "any payment or discharge of any liability on account of valuable consideration payable for the transfer of property in goods whether as goods or in some other form involved in the execution of works contract" are incorporated in the Rule. It is contended that sub-rule (2) travels beyond the section inasmuch as it refers to "all payments being made in respect of all works contract executed". This contention is based on a wrong understanding of the Rule. After sub-rule (1) expressly refers to payment on account of valuable consideration payable for the transfer of property in goods, sub-rule (2) begins with the words "the deduction under sub-rule (1)". The two sub-rules should be read together in the light of the section. Sub-rules (3) to (6) expressly refer to deduction under sub-section (1) of section 12-A of the Act. Hence, there can be no doubt that the expression "all payments being made in respect of all works contract executed" means and refers only to payments on account of valuable consideration payable for transfer of property in goods and not other payments. Sub-rules (3) to (6) expressly refer to deduction under sub-section (1) of section 12-A of the Act. Hence, there can be no doubt that the expression "all payments being made in respect of all works contract executed" means and refers only to payments on account of valuable consideration payable for transfer of property in goods and not other payments. Thus, the Rule does not go beyond the section and enable nay person to deduct any amount other than that contemplated by the section. The Rule does not suffer from any invalidity. VII. Discussion of case law cited : (a) Validity of the provision for deduction at source : 23. Even before the Supreme Court decided the Rajasthan and Karnataka cases in November, 1992 referred to earlier, the Patna High Court had an occasion to consider the validity of section 25-A of the Bihar Finance Act and rule 26-A of the Bihar Rules providing for tax deduction from bills of works contractors. In Geeta Prasad Singh and Co. v. State [1986] 63 STC 337, a Division Bench of the Patna High Court held that the section and rule were intra vires and they were not taxing provisions. The Division Bench opined that they were only providing a mode or recovery of tax and in no way infringed article 366(29A) of the Constitution. It was also held that in most of the works contracts, the percentage of the value of goods to be supplied was more than the payment for labour and it was not, therefore, unreasonable to deduct four per cent of the total bills and the provisions relating to deduction of four per cent of the total bills were not confiscatory. It was also held that the provisions were in pari materia with those of the provisions of section 194-C of the Income-tax Act, 1961 and if the contractors were entitled to reimbursement on account of levy of sales tax under the contract, they had to approach the Government and claim reimbursement of pursue their remedies on the basis of the contract. 24. In Construction & Construction v. Union of India [1990] 77 STC 405, another Division Bench of the same court upheld the validity of section 25-A of the Bihar Finance Act, which was almost the same as section 12-A of the Act. 24. In Construction & Construction v. Union of India [1990] 77 STC 405, another Division Bench of the same court upheld the validity of section 25-A of the Bihar Finance Act, which was almost the same as section 12-A of the Act. In all probability the Legislature of Himachal Pradesh State was guided by the provisions in section 25-A of the Bihar Finance Act, 1981. The only difference in sub-section (1) of section 25-A of the Bihar Act was that it declared that every person making any payment, etc., shall be lawfully competent to deduct an amount not exceeding 4 per cent, while section 12-A of the Act enjoins the person making payment to deduct by using the expression "shall deduct". The Division Bench pointed out that the section clearly spoke about the deduction to be made from any payment on account of valuable consideration payable for the transfer of property in goods, whether as goods or in some other form involved in the execution of the works contract, which is consistent with article 366(29A)(b) of the Constitution. However, rule 26-A(2) read that such deduction shall be made from all payments being made in respect of all works contracts executed. That is exactly the language of sub-rule (2) of rule 31-A of the Rules introduced in this State. With regard to the said rule 26-A(2), the Division Bench held that the words "all payments being made" shall be read to mean payments made for the transfer of property in goods. The Division Bench observed that on such an interpretation, deductions had to be made only out of payments to be made for the transfer of property in goods and no deduction is to be made in respect of the amounts spent over labour charges and other services in which no transfer of any property in goods was involved. The Bench referred to the well-settled principle of interpretation of statute that if without doing violence to the language of any provision of the Act or the Rules, it can be interpreted in a manner which can make it valid and constitutional that interpretation should be given. 25. While analysing the rule earlier, we have given a similar interpretation to the expression "all payments" found in rule 31-A(2). 25. While analysing the rule earlier, we have given a similar interpretation to the expression "all payments" found in rule 31-A(2). We are, however, on a stronger ground for giving such an interpretation as sub-rule (1) of rule 31-A is more explicit than sub-rule (1) of rule 26-A of the Bihar Sales Tax Rules, 1983. We have also referred to the language in sub-rules (3), (4), (5) and (6) in support of our interpretation. 26. A different view was taken by a Full Bench of the Patna High Court in Builders Association of India v. State of Bihar [1992] 85 STC 362. The Full Bench differed from the view expressed by the two Division Benches in the cases referred to above. A majority of the Full Bench held that section 25-A of the Bihar Act was ultra vires. Section 15 of the Central Sales Tax Act, 1956 and that it was unreasonable in so far as in terms thereof tax will compulsorily be deducted although in certain circumstances, no tax at all may be leviable. Referring to Geeta Prasad Singh's case [1986] 63 STC 337 (Pat), the Full Bench observed that there existed no provision for payment of interest if the assessee had paid tax in excess on account of the deduction in advance by the contracting party from the bill. While referring to the case in Construction & Construction v. Union of India [1990] 77 STC 405 (Pat), the Full Bench observed that though the Rule was sought to be read down by the Division Bench in that case, the same lacuna had again occurred by reason of amendment in section 25-A of the Act. The Full Bench also observed that there was a difficulty in reading down the statute, as was done by the Division Bench in the said case, in view of the fact that the persons authorised to make deductions under section 25-A(1) may not be able to determine the amount unless the entire work is completed for the purpose of finding out quantum of payments being made in respect of the works contracts executed and/or valuation of the goods transferred, which attracted the liability on the part of the contractors to pay sales tax. It is, however, to be noted that after the decision of the Division Bench in Construction & Construction v. Union of India [1990] 77 STC 405 (Pat), section 25-A would appear to have been amended by the Bihar State Legislature. 27. In Brajendra Mishra v. State of Orissa [1994] 92 STC 17 (Orissa), section 13AA of the Orissa Sales Tax Act, 1947 similar to section 12-A of the Act under our consideration was held to be unconstitutional and void by a Division Bench of the Orissa High Court. The Bench observed that the section did not provide any mechanism to exclude a transaction from its purview even if ultimately the transaction was not at all liable to levy of sales tax. The section in the Orissa Act provided that any person responsible for paying any sum to any contractor for carrying out any works contract in pursuance of a contract between the contractor and the authorities/persons mentioned therein shall at the time of credit of such sum to the account of the contractor or at the time of payment thereof in cash or by issue of a cheque or draft of any other mode, whichever was earlier, deduct an amount towards sales tax equal to two per centum of such sum in respect of the works contract. A bare reading of the section shows that it was not a provision for deduction of an amount payable for the valuable consideration for the transfer to property in goods whether as goods or in some other form involved in the execution of works contracts. On the other hand, the section directed the deduction in respect of the amount payable under the entire works contracts. That was clearly against the provisions of article 366(29A) and the law laid down by the Supreme Court in Gannon Dunkerley & Co. v. State of Rajasthan [1993] 88 STC 204; (1993) 1 SCC 364 . In fact, the Division Bench observed as follows : "If section 13AA is examined from the aforesaid standpoint, there cannot be two opinions that it does not provide any mechanism to exclude a transaction from its purview, even if ultimately the transaction is not at all liable to levy of sales tax. In fact, the Division Bench observed as follows : "If section 13AA is examined from the aforesaid standpoint, there cannot be two opinions that it does not provide any mechanism to exclude a transaction from its purview, even if ultimately the transaction is not at all liable to levy of sales tax. In other words, even in case of a pure and simple labour contract or service contract where question of sale will not arise, yet the person responsible for making any payment to the contractor has no other option than to deduct two per cent of such sum towards sales tax. Thus though a transaction which may not be 'sale' at all is liable for levy of sales tax, yet in respect of the said transaction power has been conferred to make deduction of two per cent from the amount which should be paid." The Bench also opined that the deduction would be confiscatory in character and pointed out that the section as it stood was not susceptible of any reading down of the provision. The Bench said that the constitutional validity of a statute had to be determined on the basis of its provision and ambit of its operation, as reasonably construed. As stated by us earlier, the provision in the Orissa Act was entirely different from the provision in section 12-A of the Himachal Pradesh Act. 28. In V. K. Singhal v. State of U.P. [1995] 97 STC 355, a Division Bench of the Allahabad High Court held that section 3-F and section 8-D(2) of the U.P. Sales Tax Act, 1948 and rule 44-B of the U.P. Sales Tax Rules, 1948 were ultra vires. It is unnecessary to refer to the reasoning of the Bench. 29. In Punj Lloyd v. State of M.P. [1996] 102 STC 299, a Division Bench of the Madhya Pradesh High Court considered similar provisions in the legislations of various States while upholding the validity of section 35 of the Madhya Pradesh Commercial Tax Act, 1994. The Division Bench held that the said section provided only for a sort of advance tax so that the tax could be recovered right from the inception without waiting till the whole transaction of the works contract was completed. The Division Bench held that the said section provided only for a sort of advance tax so that the tax could be recovered right from the inception without waiting till the whole transaction of the works contract was completed. It is pointed out that the incidence of taxation under the charging section remained the same and what was taxable was only the taxable turnover as defined in section 2(w) of that Act. The Division Bench also compared the provisions of section 194-C of the Income-tax Act, 1961 and took note of the absence of similar provision not only in the Madhya Pradesh Act, but also in the Acts of the States of Uttar Pradesh, Bihar, Haryana, Himachal Pradesh, Jammu and Kashmir, Karnataka and Orissa. The Bench had also referred to notification issued by the State Government under section 17 of the Madhya Pradesh General Sales Tax Act, 1958 providing a machinery for issuing a certificate of exemption from the provision for deduction at source. 30. In KEC International Limited v. State of Karnataka [1997] 105 STC 192, the Karnataka High Court struck down section 19-A of the Karnataka Sales Tax Act as ultra vires the Constitution. The said section provided for deduction of certain per centum of the total amount payable to the dealers under the works contracts. Thus, the provision in the section was entirely different from the provision in section 12-A of the Himachal Pradesh General Sales Tax Act, 1968. The Division Bench also placed reliance on the following observations of the Supreme Court in Khyerbari Tea Co. Ltd. v. State of Assam AIR 1964 SC 925 : "It may be conceded that when the Legislature constructs a machinery for the recovery of the taxes which it is within its competence to impose, the said machinery should have some rational or intelligent connection with the tax. In the absence of a rational nexus between the producer and the tax on goods carried, it may be open to a citizen to contend that the tax is not one justified by entry 56". 31. The following passage in the judgment of the Gujarat High Court in Cibatual Limited v. Union of India (1979) ELT 407 was also quoted by the Division Bench : "It is true that when Parliament levies a tax, it also provides machinery for collecting it. 31. The following passage in the judgment of the Gujarat High Court in Cibatual Limited v. Union of India (1979) ELT 407 was also quoted by the Division Bench : "It is true that when Parliament levies a tax, it also provides machinery for collecting it. Ordinarily, if the levy of a tax is constitutionally valid, the machinery provided to make it effective does not suffer from a constitutional vice. However, when, under the Constitution, the Parliament has legislative competence to levy a particular tax and when it does so, it cannot competently enact the machinery section which in the name of collecting that particular tax collects something else which is not within the legislative competence of Parliament to levy or collect. Therefore, the general principle that if the charging section is intra vires, the machinery section cannot be ultra vires is subject to the exception that machinery section does not stretch its long arms to pick-up the forbidden fruit along with others. Parliament having levied a tax is entitled to provide the mode of its assessment and the method of its collection. However, the mode of its assessment and the method of its collection cannot entrench upon the legislative field earmarked exclusively for the States. In the instant case, though section 3 is valid (its constitutionality has not been challenged), section 4 suffers from a vice because it entrenches upon entry 54 in the State List." 32. Relying upon the aforesaid passages, the Bench held that even an ancillary provision cannot go beyond the legislative power of the State and has to confine itself to the power conferred on it within the entry in one or the other of the Lists enumerated in the Constitution. After referring to the judgment of the Patna High Court in Construction & Construction v. Union of India [1990] 77 STC 405, the Division Bench said that the principles deducible from the said decision, section 19-A of the Karnataka Act was beyond the legislative competence of the State, as it included not only the turnover which was exigible to tax under the Sales Tax Act, but also the amounts which were outside the purview of entry 54 and the amounts which were not exigible to sales tax at all under the State law or the Central law. The Bench also observed that the section was arbitrary, in that, there was no machinery provided under the Act to determine even approximately the taxable turnover of a dealer for the purpose of collection of advance tax, as provided for, under section 194-C(4) of the Income-tax Act, 1961. 33. As stated earlier, the section in the Karnataka Act was entirely different from section 12-A of the Himachal Pradesh General Sales Tax Act, 1968. We should also point out that the tests prescribed by the Supreme Court in the passage quoted by the Division Bench as above and the Gujarat High Court in the passage quoted as above are satisfied in the present case. (b) Validity of the provision for payment of lump sum in lieu of tax by way of composition : 34. In Tirath Ram Ahuja Limited v. State of Haryana [1991] 83 STC 523 (P&H), a question arose whether a provision for payment of limp sum in lieu of tax by way of composition instead of deduction of tax at source by the contractees was valid. A Division Bench of the Punjab and Haryana High Court upheld the validity of such a provision. The court said that the option was with the assessee and for those who did not opt to be governed by the provisions of the section, which enabled the assessee to apt for payment in limp sum by way of composition, it was the responsibility of the contractee to deduct the per centum fixed by the Government from the payments to be made. 35. In National Heavy Engineering Co-operative Limited v. State of Haryana [1994] 93 STC 265 (P&H), another Division Bench of the same court without making any reference to the decision in the aforesaid case, i.e., Tirath Ram Ahuja's case [1991] 83 STC 523 (P&H) upheld the validity of the same section, which provided for an option to the contractors to pay tax at a fixed rate on the total value of the works contract in lieu of the tax payable by them under the Act. The Bench opined that it was merely intended to facilitate the task of assessment by providing a mode of calculation of the tax payable under the Act and that too at the option of the contractor. The Bench said that it cannot be deemed to be a tax on the total turnover of the works contract. 36. The Bench opined that it was merely intended to facilitate the task of assessment by providing a mode of calculation of the tax payable under the Act and that too at the option of the contractor. The Bench said that it cannot be deemed to be a tax on the total turnover of the works contract. 36. In Symon v. State of Kerala [1995] 97 STC 283, a single Judge of the Kerala High Court upheld the validity of a similar provision in the Kerala General Sales Tax Act enabling the contractors to opt for payment of tax at the compound rate. While discussing the question, the learned Judge referred to the judgments of the Patna High Court in Geeta Prasad Singh's case [1986] 63 STC 337 and the Punjab and Haryana High Court in Tirath Ram Ahuja's case [1991] 83 STC 523 referred to earlier and followed the same. The learned Judge referred to the judgment of the Full Bench of the Patna High Court in Builders Association of India [1992] 85 STC 362 and that of the Orissa High Court in Brajendra Mishra v. State of Orissa [1994] 92 STC 17 and dissented from the same. 37. Even before referring to the aforesaid authorities, we have pointed out the distinction between the wordings of the section in Himachal Act and the Rules made thereunder and the wordings of the statutes in orissa, Karnataka and Allahabad. On the express terms of section 12-A and rule 31-A, as interpreted by us, we have no hesitation in holding that they are constitutionally valid and in conformity with the law laid down by the Supreme Court in Gannon Dunkerley & Co. v. State of Rajasthan [1993] 88 STC 204; (1993) 1 SCC 364 . VIII. Prayer for lesser relief : 38. Though in all the petitions excepting C.W.Ps. Nos. 152 of 1995 and 63 of 1996, the prayers are only for declaring the section and the rule as ultra vires and unconstitutional, in the course of arguments, it has been submitted alternatively that a lesser relief could be granted to the petitioners by declaring that they are not liable to pay any tax under the provisions of the Act in view of the provisions contained in section 6(3)(a)(iii). It is to be mentioned here that in C.W.P. No. 152 of 1995 and C.W.P. No. 63 of 1996, there is a specific prayer to prohibit the 3rd respondent therein from deducting the sales tax out of the payments to be made to the petitioner in each case in respect of the bills submitted. 39. While the contention of the petitioners in C.W.Ps. Nos. 1839 of 1993, 199 of 1994 and 208 of 1994 is that they are governed by section 6(3)(a)(iii) of the Act inasmuch as their sales are to an undertaking which supplies electrical energy to the public under licence or sanction granted or deemed to have been granted under the Indian Electricity Act, 1910 and that the goods sold are for use by the said undertaking in the generation or distribution of such energy in C.W.P. No. 152 of 1995, the contention is that the works contract for construction of main concrete dam and coffer dams at Chamera H.E. project did not involve transfer of property in any goods and, therefore, no deduction of tax at source as envisaged under section 12-A of the Act read with rule 31-A was permissible. Though such a contention has been raised in the writ petition, no such argument was advanced separately by learned counsel. As pointed out already, the arguments were common and in so far as this limb is concerned, the contention was that all the petitioners are excluded from the taxation net by the provisions of section 6(3)(a)(iii). 40. Section 6(3) has already been extracted to the extent relevant in paragraph 19 of the judgment. A perusal thereof shows that it provides for deduction from the dealer's gross turnover on certain sales and purchases for the purpose of arriving at the taxable turnover. Sub-clause (iii) of clause (a) of the sub-section refers to sales to any undertaking supplying electrical energy to the public under licence under the Indian Electricity Act, 1910. Such sales shall be of goods for use by the said undertaking in the generation or distribution of energy. Thus, the section imposes a condition that for the purpose of deduction from the gross turnover, the goods sold must be those for use in the generation or distribution of electrical energy by the licensee under the Indian Electricity Act, 1910. Such sales shall be of goods for use by the said undertaking in the generation or distribution of energy. Thus, the section imposes a condition that for the purpose of deduction from the gross turnover, the goods sold must be those for use in the generation or distribution of electrical energy by the licensee under the Indian Electricity Act, 1910. Any person, who claims the benefit of the said sub-clause must, therefore, prove as a fact that the goods sold by him to the licensee under the Indian Electricity Act are for use by it in the generation or distribution of such energy. That is why, the clause itself contains a proviso enabling the dealer to obtain a declaration in the prescribed form from the undertaking to whom the goods are sold and furnish the same to the assessing authority. It follows that the question of applicability of section 6(3)(a)(iii) has to be considered by the assessing authority in the course of assessment. It is not a matter, which can be left to the decision of the contracting party. It is not a case of an absolute exemption declared by the statutes or the Rules themselves. For example, section 7 declares certain goods to be tax-free and sub-clause (1) of clause (a) of sub-section (3) of section 6 provides for deduction of sales tax on such goods from the gross turnover of the dealer. If the goods, which are declared to be tax-free under section 7 are sold by a dealer, he shall not collect any sum by way of sales tax because of the provisions of section 13 of the Act. Section 6(3)(a)(iii) is different from section 6(3)(a)(i). Hence, a question relating to the dealer getting a benefit under section 6(3)(a)(iii) will have to be decided by the assessing authority on the facts and circumstances of each case. 41. It is not possible for us in these writ petitions to decide the said question or uphold the claim made by the petitioners that they are entitled to the benefit of section 6(3)(a)(iii) of the Act. In our opinion, the pleadings in these cases and the materials placed before us are hardly sufficient for considering the said question. In any event, it is a matter to be decided only by the assessing authority and not by this Court under article 226 of the Constitution of India. 42. In our opinion, the pleadings in these cases and the materials placed before us are hardly sufficient for considering the said question. In any event, it is a matter to be decided only by the assessing authority and not by this Court under article 226 of the Constitution of India. 42. In C.W.P. No. 1839 of 1993, paragraphs 3 and 7 read as follows : "3. That the petitioner was awarded a 'works contract' for the construction of civil works for Pressure Shafts and Power House Complex by M/s. Nathpa Jhakri Power Corporation Limited, New Delhi to be executed within the State of Himachal Pradesh at Jhakri-Rampur, District Shimla. The said contract is to be executed by the petitioner-company in collaboration with Hyundai Engg. & Construction Company Ltd., Seoul, South Korea. 7. That in totality, the above contract is for the execution of 'works contract' for the construction of civil works for pressure shafts and power house complex to be handed over to an undertaking supplying electrical energy to the general public under a licence deemed to have been granted under the Indian Electricity Act, 1910." 43. The aforesaid averments do not clearly show that the condition imposed in section 6(3)(a)(iii) is satisfied. It is significant to note that there is no specific averment in the aforesaid paragraphs that the goods transferred under the said works contract are for the use in the generation or distribution of electrical energy. In the reply filed by the State Government in answer to paragraphs 3 and 7, it is stated that the contents thereof are admitted. Thereafter, in the rejoinder filed by the petitioner for the first time, it is stated that "the petitioner is executing a works contract and shall be transferring the property in goods, which are/will be involved in the execution to an undertaking, which is supplying electrical energy to the public and such goods are for direct use in the generation and distribution of electrical energy, as has been also admitted by the replying respondent while admitting paragraphs 3 to 5 of the writ petition". 44. 44. It is very clever on the part of the petitioner to claim in the rejoinder that there is an admission in the reply filed by the respondents that the goods transferred under the works contract ar for direct use in the generation and distribution of electrical energy when there was no such averment in the writ petition as such. Having made a vague averment in paragraphs 3 and 7 of the writ petition, it is not open to the petitioner to claim that the respondents have admitted something, which was not there in the writ petition. We are only pointing out that there is no material before us to hold that the petitioners are entitled to the benefit of section 6(3)(a)(iii) of the Act and that the contention of the petitioners that the position has been admitted by the respondents is wholly untenable. 45. In C.W.P. No. 199 of 1994, similar recitals are found in paragraphs 5 and 9, which read to the extent relevant as follows : "5. That M/s. Nathpa Jhakri Power Corporation Ltd., Delhi, is an undertaking supplying electrical energy to the public under the licence of sanction granted or to be granted or deemed to have been granted under the Indian Electricity Act, 1910. That the said Corporation floated tenders for the construction of 'civil works for dam, intake and desilting arrangement' for generation and distribution of electrical energy to be supplied to general public. 9. That by the aforesaid execution of 'works contract', the petitioner would be transferring the property in goods involved in the execution of the works contract either in full or in the goods as such and the said goods will fall within the ambit of the word 'sale' as defined under the Himachal Pradesh General Sales Tax Act, 1968 (Act No. 24 of 1968)." 46. In this case also, in the reply filed by the respondents, the contents of paragraphs 5 and 9 and admitted and in the rejoinder filed by the petitioner, an averment is introduced for the first time that the goods transferred are for direct use in the generation and distribution of electrical energy. Our above reasons with reference to C.W.P. No. 1839 of 1993 will hold good in this case also. 47. Similarly, in C.W.P. No. 208 of 1994, the averments are found in paragraphs 4, 7 and 14. Our above reasons with reference to C.W.P. No. 1839 of 1993 will hold good in this case also. 47. Similarly, in C.W.P. No. 208 of 1994, the averments are found in paragraphs 4, 7 and 14. Apart from making an averment that the petitioner has no liability towards payment of sales tax on the transfer of property in goods involved in the execution of works contract being executed in response to the award of contract made by an undertaking supplying electrical energy to the public, there is no specific allegation that the goods transferred are for use in generation or distribution of electrical energy. As in the other cases, the respondents filed a reply in which the contents of paragraphs 4 and 7 are admitted and with reference to paragraph No. 14, it is stated as follows : "The contents of this para are admitted to the extent of making reference to the provisions of section 6. Rest of the contents of this para are not admitted in view of the detailed position explained in the preliminary objection, which may be read as part and parcel to the reply of this para for the sake of brevity and to avoid repetition." 48. In the rejoinder, a specific averment is made that the goods are for direct use in the generation and distribution of electrical energy. Our reasoning with reference to C.W.P. No. 1839 of 1993 and C.W.P. No. 199 of 1994 will apply here also. 49. In C.W.P. No. 63 of 1996, the relevant averments are found in paragraph 6, which read as follows : "That in totally, the above contract is for the execution of 'works contract' for the implementation and operation of 300 MW Baspa Stage II Hydro Electric Project to be handed over to an undertaking supplying electrical energy to the general public under a licence deemed to have been granted under the Indian Electricity Act, 1910 as respondent No. 3." 50. In this case, in the reply, it is stated that the contents of paragraphs 5 and 6 need no reply by the respondents. No rejoinder was filed by the petitioner. 51. In this case, in the reply, it is stated that the contents of paragraphs 5 and 6 need no reply by the respondents. No rejoinder was filed by the petitioner. 51. Thus, on a perusal of the pleadings and the other materials placed before us, we have no hesitation to hold that the question whether the petitioners are entitled to claim the benefit of section 6(3)(a)(iii) cannot be decided in these writ petitions and it has to be decided only by the assessing authority in the course of assessment proceedings. 52. In J.K. Cotton Spinning & Weaving Mills Co. Ltd. v. Sales Tax Officer, Kanpur [1965] 16 STC 563, the Supreme Court had occasion to consider the provisions of sections 7(4) and 8(3)(b) of the Central Sales Tax Act, 1956 and with rule 13 of the Central Sales Tax Rules. The court held that if a process or activity was no integrally related to the ultimate manufacture of goods so that without that process or activity the manufacture may, even if theoretically possible, be commercially inexpedient, goods intended for use in the process or activity, as specified in rule 13 would qualify for special treatment. In that case, the court held that drawing and photographic materials falling within the description of goods intended for use as equipment in the process of designing which is directly related to the actual production of goods and without which commercial production would be inexpedient must be regarded as goods intended for use in the manufacture of goods. It was also pointed out that in the case of company manufacturing for sale cotton, textiles, tiles and other commodities, building materials including lime and cement not required in the manufacture of tiles for sale cannot be regarded within the meaning of rule 13, as raw materials in the manufacture or processing of goods or even as plant. 53. In Spedding Dinga Singh & Co. v. Punjab State [1968] 22 STC 319, the High Court of Punjab and Haryana held that the sale of timber for the construction of a power-house cannot be said to have been effected for use in the generation or distribution of electrical energy within the meaning of section 5(2)(a)(iv) of the Punjab General Sales Tax Act, 1948. v. Punjab State [1968] 22 STC 319, the High Court of Punjab and Haryana held that the sale of timber for the construction of a power-house cannot be said to have been effected for use in the generation or distribution of electrical energy within the meaning of section 5(2)(a)(iv) of the Punjab General Sales Tax Act, 1948. It was pointed out that the sale of only such goods the use of which either results in the generation or in the increase of generation of electrical energy or which are used either for arranging or facilitating distribution of the energy will fall within the statutory exemption provided in section 5(2)(a)(iv) of the Punjab General Sales Tax Act which is ad idem with the language of section 6(3)(a)(iii) in the Himachal Act. 54. In Associated Cement Co. Ltd. v. Assistant Commissioner of Sales Tax, Jabalpur Region, Jabalpur [1971] 28 STC 629, the Madhya Pradesh High Court held that the cement used for construction of office buildings and staff quarters could not be said to be used in the generation or distribution of electrical energy and, therefore, the Assistant Commissioner was right in rejecting the claim of the petitioner therein. It was also held in that case that everything sold to the Electricity Board for its use did not fall within the exemption under section 2(j)(a)(iii) of the C.P. and Barer Sales Tax Act, which was similar to section 6(3)(a)(iii) of the Himachal Act and that it was only when there was a direct use of the goods in the generation or distribution of the electrical energy that the goods sold to the Board would fall within the exemption. We are entirely in agreement with the view expressed by the Punjab and Haryana High Court in Spedding Dinga Singh's case [1968] 22 STC 319 and the Madhya Pradesh High Court in Associated Cement Co. Ltd. v. Assistant Commissioner of Sales Tax [1971] 28 STC 629. 55. Section 5(2)(a)(iv) of the Punjab General Sales Tax Act, 1948 which is similar to section 6(3)(a)(iii) of the Himachal Act came up for consideration before the Supreme Court in Indian Aluminium Cables Ltd. v. State of Haryana [1976] 38 STC 108; AIR 1976 SC 1711 . Ltd. v. Assistant Commissioner of Sales Tax [1971] 28 STC 629. 55. Section 5(2)(a)(iv) of the Punjab General Sales Tax Act, 1948 which is similar to section 6(3)(a)(iii) of the Himachal Act came up for consideration before the Supreme Court in Indian Aluminium Cables Ltd. v. State of Haryana [1976] 38 STC 108; AIR 1976 SC 1711 . The contention on behalf of the assessee before the court was that by reason of the Explanation to section 8(2A) of the Central Sales Tax Act read with section 5(2)(a)(iv) of the said Act, it was exempt from the payment of inter-State sales tax. According to the assessee, the expression "goods" for use by it in the generation or distribution of such energy occurring in section 5(2)(a)(iv) of the said Act was descriptive of the goods, but it specified the condition under which exemption was granted. The matter is dealt with in the following passages : "15. Section 6 of the State Act does not speak of exemption, but deals with tax-free goods. In other words, section 6 deals with specified goods on which no tax is payable. Section 5 of the State Act deals with what has to be excluded from the taxable turnover of the dealer. Both the sections deal with goods which do not suffer from sales tax. Section 8(2A) of the Central Act exempts goods from inter-State sales tax where a tax law of the State has exempted them from sales tax. The explanation to section 8(2A) of the Central Act takes away the exemption where it is not general and has been granted in specified circumstances or under specified conditions. The provisions contained in section 5(2)(a)(iv) of the State Act exclude sales which are made under specified circumstances or specified conditions. The specified circumstances are that the sale must be to an undertaking engaged in supplying electrical energy to the public under a licence or sanction granted under the Indian Electricity Act, 1910. The specified condition is that the goods purchased by the undertaking must be used for the generation or distribution of electrical energy. If the circumstances do not exist or if the conditions are not performed then the sales of goods cannot be exempted from tax. General exemption means that the goods should be totally exempt from tax before similar exemption from the levy of Central sales tax can become available. If the circumstances do not exist or if the conditions are not performed then the sales of goods cannot be exempted from tax. General exemption means that the goods should be totally exempt from tax before similar exemption from the levy of Central sales tax can become available. Where the exemption from taxation is conferred by conditions or in certain circumstances, there is not exemption from tax generally. 16. The contention of the appellant that the words 'in the generation or distribution of such energy' in section 5(2)(a)(iv) of the State Act are descriptive of goods is unacceptable. The expression 'generation or distribution of such energy' specifies the condition under which exemption is granted. 17. For these reasons we are of opinion that the High Court was correct in holding that the sales to the undertaking supplying electrical energy were not exempt from tax generally within the meaning of section 8(2A) of the Central Act read with section 5(2)(a)(iv) of the State Act. The appeal is dismissed. In view of the fact that the High Court directed the parties to pay and bear their own costs, similar order is made here." 56. Unfortunately, the said judgment rendered by three-Judge Bench was not brought to the notice of a Division Bench consisting of two Judges of the Supreme Court in State of Haryana v. Dalmia Dadri Cement Ltd. [1988] 68 STC 173. Dealing with the same section 5(2)(a)(iv) of the Punjab General Sales Tax Act, 1948, the Division Bench held that in order to get the exemption under section 5(2)(a)(iv), it was not necessary for the cement supplied by the respondent to be actually used in the generation or distribution of electrical energy, and the words "for use" in that section meant "intended for use". The Division Bench referred to the judgment of the Punjab and Haryana High Court in Spedding Dinga Singh [1968] 22 STC 319 and that of the Madhya Pradesh High Court in Associated Cement Co. [1971] 28 STC 629 and distinguished the same. The Division Bench referred to the judgment of the Punjab and Haryana High Court in Spedding Dinga Singh [1968] 22 STC 319 and that of the Madhya Pradesh High Court in Associated Cement Co. [1971] 28 STC 629 and distinguished the same. The decision of the Division Bench runs counter to the view expressed by the three Judges Bench in the earlier case, namely, Indian Aluminium Cables Ltd. [1976] 38 STC 108 (SC); AIR 1976 SC 1711 , wherein the court observed that the specified condition in the section was that the goods purchased by the undertaking must be used for the generation or distribution of electrical energy. 57. In Commercial Taxes Officer, Circle D, Jaipur v. Rajasthan Electricity Board [1997] 104 STC 89, the Supreme Court followed the judgment rendered in J.K. Cotton Spinning & Weaving Mills Co. Ltd. [1965] 16 STC 563 and held that the motor vehicles, soaps, paints, raincoats and battery cells to the extent mentioned in the aforesaid case were integrally related to the distribution of electricity and their non use would make distribution of electricity commercially inexpedient. The court referred to its earlier judgments in Tata Engineering & Locomotive Company Ltd. v. State of Bihar [1995] 96 STC 211 (SC) and distinguished the same. 58. The relevant principles, which should guide the assessing authority while considering the claim of the petitioners of the benefit under section 6(3)(a)(iii) of the Act have been laid down in the aforesaid judgments and it is for the assessing authority to apply the same and decide in the light of the above principles and on the facts established before it. We have open the said question for the decision of the assessing authority. We have already given our interpretation of section 12-A and rule 31-A. The contracting parties as well as the assessing authorities are to adopt the said interpretation and act accordingly while implementing the provisions of section 12-A and rule 31-A. 59. In so far as C.W.P. No. 152 of 1995 is concerned, we have already pointed out that petitioner does not claim the benefit of section 6(3)(a)(iii) of the Act, but on the other hand its claim is that the works contract executed by it did not involve transfer of property in any goods and, therefore, no deduction of tax at source was envisaged. As pointed out already, no separate argument was advanced in that regard and no materials were placed before us to show that the contract did not involve any transfer of goods. If any deduction is made by the contracting party at source when payment is made under the bills or invoices, it is certainly open to that petitioner to establish its claim before the assessing authority and seek refund of the amount paid in excess. IX. Conclusion. 60. In the result, the petitioners are not entitled to any of the reliefs prayed for by them. Consequently, these writ petitions are dismissed. There will be no order as to costs. Interim orders, if any, are vacated. Writ petitions dismissed.