JUDGMENT M.Y. Eqbal, J. 1. In this writ petition, the petitioner has prayed for issuance of appropriate writ declaring that the inter-state safes originated from Pondicherry to the State of Bihar in execution of works contract are exigible to sales tax to Pondicherry jurisdiction under Central Sales Tax Act, 1956 and further prayed for issuance of appropriate writ in the nature of certiorari for quashing the order of assessment for the year 1994-95 so far as raising of additional tax demand of Rs. 5,35,223=24 or inter-state sales transactions which is exigible to Pondicherry jurisdiction under the Central Sales Tax Act, 1956 is concerned, as the same being illegal and contrary to law and is wholly without jurisdiction. Further prayer has been made for issuance of appropriate direction to respondent No. 3 to give effect to the tax paid and realized and grant of refund of the said amount. 2. The brief facts of the case are as under: The petitioner is a registered company having business activities in every States as well as having manufacturing unit located outside the State of Bihar including Pondicherry and, are registered dealer under Local and Central Sales Tax Acts in the respective States. The petitioner alleged to have filed return and discharged their tax liability for the assessment year 1994-95. The petitioner claimed exclusion of inter-state sales tax from their Pondicherry unit as well as refund of the sales tax. The Assessing Authority passed order rejecting the petitioners plea and also partially considering credit of Rs. 22,72,227=00 raised additional tax demand without explaining reason for not allowing credit to the balance amount. According to the petitioner, the execution of Railways Electrification contract necessitated manufacturing of specifically described goods as per the order in their Pondicherry works as well as procurement from other source for execution of the works contract. Such manufacturing goods are as per the design and drawings provided by respondent No. 7 - the Railways authority. Such goods are exclusively meant for respondent No. 7 and cannot be sold or diverted for others. Thus the goods so manufactured by the Pondicherry works were dispatched from their Pondicherry works to the contractee place of work at Barwadih in Bihar State. Such goods are exclusively meant for respondent No. 7 and cannot be sold or diverted for others. Thus the goods so manufactured by the Pondicherry works were dispatched from their Pondicherry works to the contractee place of work at Barwadih in Bihar State. The Assessing Authority considered such supply to be sale within the State of Bihar despite the fact that the petitioner has already discharged its Central Sales Tax liability in Pondicherry and passed order for assessment vide order dated 12.10.1998. The petitioners further case is that such turnover of inter-state sales as effected from Pondicherry, have been subjected to assessment proceedings as well as tax imposed by the Assessing Authority vide order dated 2.10.1998 despite the fact that the transactions have already been subjected to tax by Pondicherry State. 3. Respondents case in the counter affidavit is that the petitioner is engaged in execution of works contract in the State of Bihar relating to the Railways electrification works for the assessment year 1994-95. The petitioner filed original annual return showing gross turnover of Rs. 7,48,52,251=00. Thereafter, the petitioner again field revised annual return showing gross turnover of Rs. 4,96,30,535=00. In the revised return, the petitioner claimed exclusion from their gross turnover, the following amount: (A) Rs. 6,33,689.00 - Being difference between the bill value and certified value. (D) Rs. 1,12,07,446.00 - Being the amount of mobilisation advance received from the Contractoree department, which were wrongly included in the gross turnover in the original return. (C) Rs. 1,33,80,581.00 - Being the amount of inter state sale / purchase from Pondicherry. 4. Further case of respondent is that in course of hearing of the assessment proceedings, the amount shown at (A) and (B) were found to be justified, hence these two amounts were excluded from their gross turnover as per their submission and after thorough verification. Thereafter, the amount of inter- state sales / purchase from Pondicherry to the tune of Rs. 1,33,80,581=00 showing at (C) above is concerned, it was thoroughly examined and verified in course of hearing of the case and it was found that two independent transactions have taken place and hence, there are two independent sales. The Respondents further case is that the first sale has taken place between Pondicherry manufacturing unit and the petitioner which is undoubtedly an inter-state transaction for which Central Sales Tax at Pondicherry has rightly been paid. The Respondents further case is that the first sale has taken place between Pondicherry manufacturing unit and the petitioner which is undoubtedly an inter-state transaction for which Central Sales Tax at Pondicherry has rightly been paid. Since the second sale has taken place between the petitioner and the contractoree department, in the State of Bihar, which is admittedly an intra- state sale which attracts the levy of Bihar Sales Tax under Bihar Finance Act, 1981 and as such the above amount has been determined as taxable in Bihar and the same has been added to the revised gross turnover of the petitioner. The Respondents further case is that Bihar Sales tax on the above transaction has been legally levied for the reasons that there has taken place two independent sales, one subject to Central Sales Tax at Pondicherry and the other subject to Bihar Sales Tax in the State of Bihar. Further the movement of goods started from Pondicherry and terminated at Petitioners site. After taking the delivery of the goods and storing them by the petitioner, it was used in the works contract for electrification of Railways. After the works of electrification of Railways was complete, the entire structure including the goods in question was transferred to the Contractoree department. It is crystal clear that there was break in the movement of goods from Pondicherry manufacturing unit to the ultimate buyer, i.e. the contractoree department and as such it can, in no case be a single transaction. The Respondents accordingly stated that the claim of Rs. 1,33,80,851=00 has been rightly and legally rejected by the Respondents. 5. The petitioner has raised the following three issues in the present writ petition: i) The goods which form inter state sales cannot be included in the gross taxable turnover in the State where it has been sent if those goods are used in the execution of work contract in the light of the judgment of Honble Supreme Court rendered in the case reported in (1993) 1 SCC 364 . ii) The goods which have been manufactured and sent from Pondicherry to Bihar are admittedly iron and steel and iron and steel being declared goods Under Section 14 of the Central Sales Tax Act, 1956 can be taxed only once and that too @ 4% under the provisions of Section 5 of the Central Sales Tax Act, 1956 and in the present case, admittedly, goods in question being declared goods there is no question of levying any further tax. iii) In absence of any proper mechanism evolved by the State, during the period in question, no assessment can be done in respect of work contract as held by the Division bench of Patna High Court in the case of this petitioner reported in 134 STC. The said judgment has been followed by the Jharkhand High Court in the case of Voltas Ltd. v. The State of Jharkhand reported in 2007(5) VST 492 and affirmed by the Honble Supreme Court in the case of State of Jharkhand v. Voltas Ltd. reported in 2007(7) VST 317. 6. Mr. Mittal, Learned Counsel appearing for the petitioner, firstly submitted that earlier there was a dispute as to whether any tax can be levied at all on work contract, but the said conflict was resolved by the Supreme Court in the case of State of Madras v. Gannon Dunkerley and Co. and Anr. reported in 1958 (9) STC 353, in which the Supreme Court held that when a building contract is entered, there is no sale of goods because in such a contract the agreement between the parties is that the contractor should build according to the specification contained in the agreement and in consideration there for release of payment as provided therein and in such an agreement, there was neither a contract to sale the materials used in the construction nor those properties based therein as movables. Mr. Mittal then submitted that after 46 th Amendment, constitutional validity of the said amendment as well as amendment made by the State legislature on that basis was challenged in the Supreme Court in the case of Builders Association of India and Ors. v. Union of India and Ors. 73 STC. Mr. Mittal then submitted that after 46 th Amendment, constitutional validity of the said amendment as well as amendment made by the State legislature on that basis was challenged in the Supreme Court in the case of Builders Association of India and Ors. v. Union of India and Ors. 73 STC. In the said judgment, the Supreme Court has laid down the principles of the law and held that the Tax Laws passed by the State Legislature levying taxes on the transfer of property in goods involved in the execution of the work contract are subject to restriction and conditions mentioned in each clause or sub-clause of Article 286 of the Constitution. 7. On the 2 nd point, Mr. Mittal submitted that in view of Sections 14 and 15 of the Central Sales Tax Act, 1956, no tax can be imposed since iron and steel are declared goods under Section 14 and as such, after tax has been imposed at one stage, on the said items, tax cannot be imposed on those goods again. Learned Counsel drew our attention to the certificate issued by the Commercial Tax Department, Govt. of Pondicherry to the effect that in respect of the assessment year 1994-95, the assessment proceeding has already completed and the petitioner has declared a gross turnover under the Central Sales Tax Act, 1956 which includes supplies effected by the petitioner. 8. On the 3 rd and last point, Mr. Mittal submitted that in absence of proper mechanism, both under the provisions of Bihar Finance Act, 1981 as well as Bihar Sales Tax Rules, 1983, no assessment at all can be made in respect of work contract. In this regard, Learned Counsel relied upon a decision of the Patna High Court in the case of Larsen and Toubro v. The State of Bihar and Ors. 134 STC 345. Lastly, learned Counsel submitted that the petitioner is entitled to the relief claimed in the writ petition for various reasons. Firstly, the value of the goods brought from Pondicherry to Bihar for use in the execution of Works Contract has to be excluded from the gross taxable turnover in view of the judgment of the Honble Supreme Court. Lastly, learned Counsel submitted that the petitioner is entitled to the relief claimed in the writ petition for various reasons. Firstly, the value of the goods brought from Pondicherry to Bihar for use in the execution of Works Contract has to be excluded from the gross taxable turnover in view of the judgment of the Honble Supreme Court. Secondly, the goods admittedly be declared goods Under Section 14 of the Central Sales Tax Act, 1956 cannot be taxed twice under the provisions of Section 15 of the Central Sales Tax Act, 1956 and thirdly, in view of the judgment of the Patna High Court in the case of Larsen and Toubro v. The State of Bihar and Ors. followed by the said High Court and affirmed by the Supreme Court, no assessment at all can be made in absence of proper follow up mechanism of Section 21(1) of Bihar Finance Act and as such the assessment orders have to be set aside in its totality. 9. On the other hand, Mr. Himanshu Kumar Mehta, Learned Counsel appearing for the respondent-State firstly submitted that admittedly the contract in question was a turn key contract and the goods upon which tax have been imposed are declared goods. Further, goods were transferred from Pondicherry to Bihar and consigner is petitioner and consignee is the Railway. Respondents have neither produced documents of purchase of sale nor any documents have been produced showing that the order was placed by the petitioner. 10. Learned Counsel further submitted that the judgment reported in 88 STC 204 is not in their support because of the fact that the judgment reported in the case of Builders Association of India and Ors. v. Union of India and Ors. is affirmed in M/s. Gannon Durnkerly and Co. & Anr. . The impugned order does not disclose the tax assessed upon gross taxable turnover. 11. The Central Sales Tax Act, 1956 (hereinafter referred to as the CST Act) has been enacted, inter alia, for determining when a sale or purchase of goods takes place in course of the inter-State trade or commerce and to provide for levy, collection and distribution of taxes on sales of goods in the course of inter-State trade or commerce. 11. The Central Sales Tax Act, 1956 (hereinafter referred to as the CST Act) has been enacted, inter alia, for determining when a sale or purchase of goods takes place in course of the inter-State trade or commerce and to provide for levy, collection and distribution of taxes on sales of goods in the course of inter-State trade or commerce. Prior to coming into force of this CST Act and the Constitution of India, the Government of India Act, 1935 empowered the provinces to levy the tax on the sales of goods. There was no specific provision for the levy of tax on the inter-State sales of goods, but each province had laid down its definition of sales in their laws of sales tax. 12. Section 2(c) defines the word "declared goods" which means goods declared under Section 14 to be of special importance in the inter-State trade or commerce. 13. Section 3 lays down the provision as to when a sale or purchase of goods is to take place in the course of inter-State trade or commerce. Section 3 reads ns under: 3. When is a sale or purchase of goods said to take place in the course of inter-State trade or commerce. - A sale or purchase of goods shall be deemed to lake place in the course of inter-State trade or commerce if the sale or purchase-- (a) occasions the movement of goods from one State to another; or (b) is effected by a transfer of documents of title to the goods during their movement from one State to another. 14. Similarly, Section 4 lays down the provision as to when a sale or purchase of goods is said to take place outside a State. Section 4 reads as under: 4. When is a sale or purchase of goods said to take place outside a State. - (1) Subject to the provisions contained in Section 3, when a sale or purchase of goods is determined in accordance with Sub-section (2) to take place inside a state, such sale or purchase shall be deemed to have taken place outside all other States. When is a sale or purchase of goods said to take place outside a State. - (1) Subject to the provisions contained in Section 3, when a sale or purchase of goods is determined in accordance with Sub-section (2) to take place inside a state, such sale or purchase shall be deemed to have taken place outside all other States. (2) A sale or purchase of goods shall be deemed to take place inside a State, if the goods are within the State - (a) in the case of specific or ascertained goods, at the time the contract or sale is made; and (b) in the case of unascertained or future goods, at the time of their appropriation to the contract of sale by the seller or by the buyer, whether assent of the other party is prior or subsequent to such appropriation. 15. Section 5 lays down the provisions as to when a sale or purchase of goods takes place in the course of import or export. Section 6 is the important provision which casts a liability and also tax on the inter-State sales. According to this Section, every dealer shall be liable to pay tax under this Act on all sales of goods other than electrical energy effected by him in the course of inter-State trade or commerce. Sub-section (2) of Section 6 provides that where a sale of any goods in the course of inter-State trade or commerce has either occasioned the movement of such goods from one State to another or has been effected by a transfer of documents of title to such goods during their movement from one State to another, any subsequent sale during such movement effected by a transfer of documents of title to such goods to the Government or to a registered dealer other than the Government shall be exempted from tax if the goods are of the description referred to in Sub-section (3) of Section 8 of the Act. 16. Section 8 is a charging section which prescribes the rate of tax on sales of goods in the course of inter-State trade or commerce. According to this Section, every dealer in the course of inter-State trade or commerce, sells the goods to the Government or to a registered dealer, shall be liable to pay tax which shall be four per cent of his turnover. 17. According to this Section, every dealer in the course of inter-State trade or commerce, sells the goods to the Government or to a registered dealer, shall be liable to pay tax which shall be four per cent of his turnover. 17. Section 14 of the Act declares certain goods as having special importance in the inter-State trade or commerce. Section 15 provides certain restrictions and conditions in regard to tax on sale or purchase of declared goods within State. For better appreciation, Section 15 is quoted herein below: 15. Restrictions and Conditions in regard to tax on sale or purchase of declared goods within a State. - Every sales tax law of a State shall, in so far as it imposes or authorises the imposition of a tax on the sale or purchase of declared goods, be subject to the following restrictions and conditions, namely- (a) The tax payable under that law in respect of any sale or purchase of such goods inside the State shall not exceed 4% of the sale or purchase price thereof, and such tax shall not be levied at more than one stage. (b) Where a tax has been levied under the law in respect of the sale or purchase inside the State of any declared goods and as such goods are sold in the course of inter-State trade or commerce, and tax has been paid under this Act in respect of the sales of such goods in the course of inter-Stale trade or commerce the tax levied under such law shall be reimbursed to the person making such sale in the course of inter-State trade or commerce in such manner and subject to such conditions as may be provided in any law in that State. (c) Where a tax has been levied under that law in respect of the sale or purchase inside State of any paddy referred to in Sub-clause (i) of Clause (1) of Section 14, the tax leviable on rice procured out of such paddy shall be reduced by the amount of tax levied on such paddy; (ca) Where a tax on sale or purchaser of paddy referred to in Sub-clause (i) of Clause (1) of Section 14 is leviable under the law and the rice procured out of such paddy is exported out of India, then for the purpose of Sub-section (3) of Section 5 the paddy and rice shall be treated as single commodity. (d) each of the pulses referred to in Clause (vi-a) of Section 14, whether whole or separated, and whether with or without husk, shall be treated as a single commodity for the purposes of levy of tax under that law. 18. We have examined the facts of the case and also gone through the ratio decided by the Supreme Court in the cases referred by the counsels. In our view, the questions involved in this writ petition are no longer res integra as the same has been fully discussed and answered by the Supreme Court in those decisions. 19. The history of relevant constitutional and statutory provisions and of judicial decisions prior to commencement of the Constitution of India and the power to levy sales tax and also the constitutional amendment made by the Parliament have been fully discussed by the Supreme Court in the case of Builders Association of India and Ors. v. Union of India and Ors. . Suffice it to say that in 1982, the Parliament passed the 46th Amendment amending the Constitution in several respects in order to bring many of the transactions in which property in goods passed but were not considered as sale for the purpose of levy of sales tax within the scope and power of the State to levy sales tax. By the 46 th Amendment, Clause (29-A) was inserted in Article 366 of the Constitution of India. For better appreciation, the relevant portion of Article 366 is quoted herein below: 366. Definitions. - In this Constitution, unless the context otherwise requires, the following expressions have the meanings hereby respectively assigned to them, that is to say - (1) ... (2) to (29) ... For better appreciation, the relevant portion of Article 366 is quoted herein below: 366. Definitions. - In this Constitution, unless the context otherwise requires, the following expressions have the meanings hereby respectively assigned to them, that is to say - (1) ... (2) to (29) ... (29A) "Tax on the sale or purchase of goods" includes- (a) a tax on the transfer, otherwise than in pursuance of a contract, of property in any goods for cash, deferred payment or other valuable consideration; (b) 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; (c) a tax on the delivery of goods in hire-purchase or any system of payment by instalments; (d) a tax on the transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; (e) a tax on the supply of goods by any unincorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration; (f) a tax on the supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (whether or not intoxicating), where such supply or service, is for cash, deferred payment or other valuable consideration, and such transfer, delivery or supply of any goods shall be deemed to be a sale of those goods by the person making the transfer, delivery or supply and a purchase of those goods by the person to whom such transfer, delivery or supply is made. 20. By virtue of 46 th Amendment, the State Governments started making amendments in their local sales tax laws for the purpose of levy of sales tax on the turnover of the works contracts entered into by the building contractors for constructing houses, factory, bridges, etc, Each State adopted its own method of determining taxable turnover either by framing Rules under its Sales Tax laws or by issuing administrative directions. It was found that the assessing authorities while making assessment did not make any attempt to ascertain whether the sales of the goods involved in execution of works contracts had taken place in favour of the petitioners who had assigned the contract outside the State in which the works contract was being executed or whether any part of the goods so used in a work contracts had been imported from abroad on account of the person who had assigned the contract or whether any part of the goods, such as, iron and steel etc, which were declared goods, had already suffered sales tax at an earlier point in the State and whether on such goods, the tax which was being levied exceeded to limit prescribed by Section 15 of the Central Sales Tax Act, 1956. The assessee, therefore, moved the Supreme Court challenging the constitutional validity of 46th Amendment and also raised the point that it was not open to the State to ignore the provisions contained under Article 286 of the Constitution and the provisions of Central Sales Tax Act, 1956 while making assessment under the Sales Tax Law passed by the Legislature State. The Supreme Court in Builders Associations case (supra), firstly observed: 32. Before proceeding further it is necessary to understand what Sub-clause (b) of Clause (29-A) of Article 366 of the Constitution means. Article 366 is the definition clause of the Constitution. It says that in the Constitution unless the context otherwise requires, the expressions defined in that article have the meanings respectively assigned to them in that article. The expression goods is defined in Clause (12) of Article 366 of the Constitution as including all materials, commodities and articles. It is true that in State of Madras v. Gannon Dunkerley & Co. (Madras) Ltd. this Court held that a works contract was an indivisible contract and the turnover of the goods used in the execution of the works contract could not, therefore, become exigible to sales tax. It was in order to overcome the effect of the said decision Parliament amended Article 366 by introducing Sub-clause (b) of Clause (29-A). Sub-clause (b) of Clause (29-A) states that "tax on the sale or purchase of goods" includes among other things a tax on the transfer of property in the goods (whether as goods or in some other form) involved in the execution of a works contract. Sub-clause (b) of Clause (29-A) states that "tax on the sale or purchase of goods" includes among other things a tax on the transfer of property in the goods (whether as goods or in some other form) involved in the execution of a works contract. It does not say that a tax on the sale or purchase of goods included a tax on the amount paid for the execution of a works contract. It refers to 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 emphasis is on the transfer of properly in goods (whether as goods or in some other form). The latter part of Clause (29-A) of Article 366 of the Constitution makes the position very clear. While referring to the transfer, delivery or supply of any goods that takes place as per Sub-clauses (a) to (f) of Clause (29-A), the latter part of Clause (29-A) says that "such transfer, delivery or supply of any goods" shall be deemed to be a sale of those goods by the person making the transfer, delivery or supply and a purchase of those goods by the person to whom such transfer, delivery or supply is made. Hence, a transfer of property in goods under Sub- clause (b) of Clause (29-A) is deemed to be a sale of the goods involved in the execution of a works contract by the person making the transfer and a purchase of those goods by the person to whom such transfer is made. The object of the new definition introduced in Clause (29-A) of Article 366 of the Constitution is, therefore, to enlarge the scope of tax on sale or purchase of goods wherever it occurs in the Constitution so that it may include within its scope the transfer, delivery or supply of goods that may take place under any of the transactions referred to in Sub-clauses (a) to (f) thereof wherever such transfer, delivery or supply becomes subject to levy of sales tax. So construed the expression tax on the sale or purchase of goods in entry 54 of the State List, therefore, includes 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 also. So construed the expression tax on the sale or purchase of goods in entry 54 of the State List, therefore, includes 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 also. The tax leviable by virtue of Sub-clause (b) of Clause (29-A) of Article 366 of the Constitution thus becomes subject to the same discipline to which any levy under entry 54 of the State List is made subject to under the Constitution. The position is the same when we look at Article 286 of the Constitution. Clause (1) of Article 286 says that no law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of goods where such sale or purchase takes place -- (a) outside the Stale; or (b) in the course of the import of the goods into, or export of the goods out of, the territory of India. Here again we have to read the expression a tax on the sale or purchase of goods found in Article 286 as including the transfer of goods referred to in Sub-clause (b) of Clause (29-A) of Article 366 which is deemed to be a sale of goods and the tax leviable thereon would be subject to the terms of Clause (1) of Article 286. Similarly the restrictions mentioned in Clause (2) of Article 286 of the Constitution which says that Parliament may by law formulate principles for determining when a sale or purchase of goods takes place in any of the ways mentioned in Clause (1) of Article 286 would also be attracted to a transfer of goods contemplated under Article 366(29A)(b). Similarly Clause (3) of Article 286 is also applicable to a tax on a transfer of property referred to in Sub-clause (b) of Clause (29-A) of Article 366. Clause (3) of Article 286 consists of two parts. Sub-clause (a) of Clause (3) of Article 286 deals with a tax on the sale or purchase of goods declared by Parliament by law to be of special importance in inter-State trade or commerce, which is generally applicable to all sales including the transfer, supply or delivery of goods which are deemed to be sales under Clause (29-A) of Article 366 of the Constitution. If any declared goods which are referred to in Section 14 of the Central Sales Tax Act, 1956 are involved in such transfer, supply or delivery, which is referred to in Clause (29-A) of Article 366, the sales tax law of a State which provides for levy of sales tax thereon will have to comply with the restrictions mentioned in Section 15 of the Central Sales Tax Act, 1956. Clause (b) is an additional provision which empowers Parliament to impose any additional restrictions or conditions in regard to the levy of sales tax on transactions which will be deemed to be sales under Sub-clause (b) or Sub-clause (c) or Sub-clause (d) of Clause (29-A) of Article 366 of the Constitution. We do not find much substance in the contention urged on behalf of the States that since Sub-clause (b) of Clause (3) of Article 286 of the Constitution refers only to the transactions referred to in Sub-clauses (b), (c) and (d) of Clause (29-A) of Article 366, the transactions referred to under those three sub- clauses would not be subject to any other restrictions set out in Clause (1) or Clause (2) or Sub-clause (a) of Clause (3) of Article 286 of the Constitution. It may be that by virtue of Sub-clause (b) of Clause (3) of Article 286 it is open to Parliament to impose some other restrictions or conditions which are not generally applicable to all kinds of sales. That however cannot make the other parts of Article 286 inapplicable to the transactions which was deemed to be sales under Article 366(29A) of the Constitution. We are of the view that all transfers, deliveries and supplies of goods referred to in Clauses (a) to (f) of Clause (29-A) of Article 366 of the Constitution are subject to the restrictions and conditions mentioned in Clause (1), Clause (2) and Sub-clause (a) of Clause (3) of Article 286 of the Constitution and the transfers and deliveries that take place under Sub-clauses (b), (c) and (d) of Clause (29-A) of Article 366 of the Constitution are subject to an additional restriction mentioned in Sub- clause (b) of Article 286(3) of the Constitution. 21. His Lordships finally held as under: 40. 21. His Lordships finally held as under: 40. We are surprised at the attitude of the States which have put forward the plea that on the passing of the 46th Amendment the Constitution had conferred on the States a larger freedom than what they had before, in regard to their power to levy sales tax under entry 54 of the State List. The 46th Amendment does no more than making it possible for the States to levy sales tax on the price of goods and materials used in works contracts as if there was a sale of such goods and materials. We do not accept the argument that Sub-clause (b) of Article 366(29A) should be read as being equivalent to a separate entry in List II of the Seventh Schedule to the Constitution enabling the States to levy tax on sales and purchases independent of entry 54 thereof. As the Constitution exists today the power of the States to levy taxes on sales and purchases of goods including the "deemed" sales and purchases of goods under Clause (29-A) of Article 366 is to be found only in entry 54 and not outside it. We may recapitulate here the observations of the Constitution Bench in the case of Bengal Immunity Company Ltd. 2 in which this Court has held that the operative provisions of the several parts of Article 286 which imposes restrictions on the levy of sales tax by the States are intended to deal with different topics and one could not be projected or read into another and each one of them has to be obeyed while any sale or purchase is taxed under entry 54 of the State List. 41. We, therefore, declare that 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. We, however, make it clear that the cases argued before and considered by us relate to one specie of the generic concept of "works contracts". The case-book is full of the illustrations of the infinite variety of the manifestation of "works contracts". We, however, make it clear that the cases argued before and considered by us relate to one specie of the generic concept of "works contracts". The case-book is full of the illustrations of the infinite variety of the manifestation of "works contracts". Whatever might be the situational differences of individual cases, the constitutional limitations on the taxing power of the State as are applicable to "works contracts" represented by "building contracts" in the context of the expanded concept of "tax on the sale or purchase of goods" as constitutionally defined under Article 366(29A), would equally apply to other species of works contracts with the requisite situational modifications. 22. In the case of Gannon Dunkerley and Co. v. State of Rajasthan , fresh writ petitions were filed challenging the validity of the provisions of Rajasthan Sales Tax Act, 1954 and the Rules, 1955 relating to imposition of tax on transfer of property and goods involved in the works contracts. The present petitioner also filed writ petitions under Article 32 of the Constitution of India challenging the validity of the provisions relating to imposition of tax on the transfer of property and goods involved in the execution of works contracts contained in the Sales Tax laws of the States of Tamilnadu, Andhra Pradesh and Rajasthan. The reasons for approaching the Supreme Court under Article 32 of the Constitution was that in spite of the decision in the Builders Associations case, the petitioner was being subjected to demand for tax in relation to the works contracts by various States and each State is wanting to tax the sales transaction on the basis that it constitutes a sale under its Sales Tax law. The Supreme Court again elaborately discussed the constitutional amendment and the relevant provisions of Central Sales Tax Act and the local laws and also the ratio decided in Builders Associations case. The Supreme Court again elaborately discussed the constitutional amendment and the relevant provisions of Central Sales Tax Act and the local laws and also the ratio decided in Builders Associations case. In the case of M/s. Gannon Dunkerley and Companys case (supra), it was strenuously and seriously contended on behalf of the State that a deemed sale resulting from transfer of property in goods involved in the execution of a works contract can never be a sale in the course of inter-State trade or commerce and it cannot be an outside sale or a sale in the course of import since the transfer of property in the goods takes place only at the stage when the goods are incorporated into the works and that can take place only in the State where the works is required to be executed. On behalf of the contractors, on the other hand, it has been urged that a works contract can involve transactions constituting a sale in the course of inter-State trade and commerce as well as an outside sale or a sale in the course of import and that is a matter which will have to be considered in accordance with the principles contained in Sections 3, 4 and 5 of the Central Sales Tax Act keeping in view the terms and conditions of the particular contract. In this regard, the Learned Counsel have placed reliance on a number of decisions of this Court wherein the provisions of Sections 3 and 4 of the Central Sales Tax Act, 1956 have been considered. We do not propose to go into this controversy because the question whether a deemed sale resulting from transfer of property in goods involved in the execution of a particular works contract amounts to a sale in the course of inter-State trade or commerce under Section 3 of the Central Sales Tax Act or an outside sale under Section 4 of the Central Sales Tax Act or a sale in the course of import under Section 5 of the Central Sales Tax Act has to be decided in the light of the particular terms of the works contract and it cannot be decided in the abstract. As at present advised, we are not in a position to say that in no case, can there be a sale in the course of inter-State trade or commerce or an outside sale or a sale in the course of import in respect of a deemed sale resulting from transfer of property in goods involved in the execution of a works contract falling within the ambit of Sub-clause (b) of Clause (29-A) of Article 366 of the Constitution. 23. The Supreme Court after discussing the law, came to the following conclusion: 51. The aforesaid discussion leads to the following conclusions: (1) In exercise of its legislative power to impose tax on sale 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 Slate 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 arc involved in execution of the 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 architects fees; and (v) cost of consumables used in 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. 24. (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. 24. Coming back to the instant case, as noticed above, it has not been disputed by the respondents that the goods in question was manufactured and sent from Pondicherry to Bihar and iron & steel being declared goods under Section 14 of the Central Sales Tax Act and the same can be taxed only once @ 4% under the provisions of Section 15 of the Central Sales Tax Act. It is also not in dispute that during the relevant year, no assessment can be done in respect of works contract inasmuch as there was no sale of goods and the building contract was entered. The petitioner annexed certificate issued by the Commercial Tax Department, Government of Pondicherry to the effect that assessment proceedings were completed in respect of the assessment year 1994-95 wherein the petitioner declared a gross turnover under the Central Sales Tax Act including the supply effected by the petitioner. Since admittedly the goods in question are declared goods under Section 14 of the Act and had already suffered tax in Pondicherry, then no further tax can be levied. 25. A similar question came for consideration before a Division bench of the Patna High Court in the case of the present petitioner namely Larsen and Toubro v. The State of Bihar and Ors. 134 STC 345, wherein the Patna High Court following the aforementioned judgment of the Supreme Court came to the conclusion that the State Legislature can not impose tax on sale in course of the inter-state trade or commerce in relation to works contract since they fall outside the field of legislative competence of the State Legislature. Their Lordships observed: 13. 134 STC 345, wherein the Patna High Court following the aforementioned judgment of the Supreme Court came to the conclusion that the State Legislature can not impose tax on sale in course of the inter-state trade or commerce in relation to works contract since they fall outside the field of legislative competence of the State Legislature. Their Lordships observed: 13. From this judgment of the Supreme Court it would be crystal clear that particular amounts are deductible and apart from that it would be necessary to exclude from the value of the works contract, the value of those goods which are not taxable in view of Sections 3, 4 and 5 of the Central Sales Tax Act and goods covered by Sections 14 and 15 of the Central Sales Tax Act as well as goods which are exempt from tax under the sales tax legislation of the State. The Court further observed: 31. In our considered opinion Sub-clause (i) of Clause (a) of Section 21(1) read with Rule 13A of the Rules did not make Sub-clause (1) fully workable because the manner and extent of deduction relating to any other charges has not been provided/prescribed by the State. 32. The assessment orders in view of the discussions aforesaid cannot be allowed to stand. The same deserve to and are accordingly quashed. Consequently neither recovery proceedings can be initiated against the petitioners nor any coercive action can be taken against them. 26. As noticed above, the goods in question which was sent from Pondicherry to Bihar are admittedly iron and steel being declared goods under Section 14 of the Central Sales Tax Act, 1956 and the same was taxed under the provisions of Section 5 of the Act. Further, at the time of movement of goods from Pondicherry to Bihar, no proper mechanism was evolved under the local law for assessment in respect of the works contract. In our opinion, therefore, the order of assessment passed by the Assessing Authority is illegal, arbitrary and cannot be sustained in law. 27. For the reasons aforesaid, this application is allowed and the impugned order of assessment is set aside. It is held that no further sales tax is payable in respect of the goods in question used in the works contract. D.G.R. Patnaik, J. 28. I agree.