JUDGMENT K.B.K. Vasuki, J. 1. The above Tax Case Revision is filed at the instance of the assessee as against the order of Sales Tax Appellate Tribunal dated 22.3.2010 passed in STA No.175 of 2006 in respect of assessment year 2000-01. The above Tax Case Revision was admitted on the following substantial questions of law:- "1. Whether the Appellate Tribunal was correct in treating the entire turnover relating to the designing, manufacturing, supply, erection, installation, testing and commissioning of lifts/elevators as per the specifications of each customer as "sale" under section 3(2) of the Act; contrary to the factual finding of the assessing officer and that of the First Appellate authority on the erroneous grounds which were neither raised not argued before it by the respondent herein? 2) Whether the Appellate Tribunal was justified in totally ignoring the definition of section 2(u) defining "works contract" to include designing, manufacturing, supplying, erection, installing, testing and commissioning of lifts/elevators as per the specifications of the each customer, wherein the parts are brought to the site of the customer and thereafter the contract is executed at the site of the customer resulting in agglomeration of the goods to the immovable property of the customer and not delivery as such of any finished goods to treat it as an outright "sale" under section 2(n) of the Act? 3) Whether the Appellate Tribunal committed an error in totally ignoring the finding of the assessing officer and the Appellate authority that the goods were manufactured at Gaziabad in the State of Uttar Pradesh pursuant to the order placed by the customer specifically earmarking the same with respect to the "Job-no", name and place of the ultimate customer even in the delivery challan and the lorry receipt which partakes the character of an inter-state movement of goods not taxable under the Local Act? 4) Whether the Appellate Tribunal was justified in erroneously rejecting the submission of the petitioner that the payment of Central Sales Tax is not test in determining the nature of the transactions as to whether the sale was an inter-state sale under the Central Sales Tax Act, 1956 or an intra-state sale under the Tamilnadu General Sales Tax Act, 1959 in the absence of any enabling provisions under the Central Sales Tax Act, 1956 till 2002 enabling to tax "works contract" as held by the Apex Court in (2000) 119 STC 182 ? 5) Whether the Appellate Tribunal was empowered under the Act to refix the taxable turnover at Rs.3,62,73,408/- by directing the assessing officer to re-assess the turnover as an outright sale under section 3(2) of the Act, which tantamount to making a revision of assessment on the turnover of Rs.1,08,82,022/-relating to the assessment year 2000-01 being barred by limitation under section 16 of the Act in the absence of any petition filed by the respondent pending the appeal? 6) Whether the Appellate Tribunal was correct in not appreciating the law that the Appeal filed by the respondent cannot be maintained in view of the statutory circular of the Special Commissioner issued in Acts. Cell-ID/D.Dis/9453/2001 dated 20.4.2001 issued under section 28A of the Act?" 2. The assessee herein is engaged in the business of manufacturing, erection of lifts, lift spares etc. The assessee have registered office at Delhi and factory at Ghaziabad, wherein, manufacturing activities are carried on. The assessee herein is one of the Branch Offices in Tamil Nadu. The modus operandi of the business of the branch is firstly to enter into an agreement with the customers for supply, erection and commissioning of lifts at the rates mutually agreed upon between the customers and the assessee. On entering into the agreement, the extract of purchase order and the description of the list will be sent to their factory at Ghaziabad and on receipt of the details regarding the specifications of the lift, place where the lift is being erected, the job number etc., their factory at Ghaziabad will prepare the drawing, which will tally with the description of the lifts and forward the same to the dealers for getting approval of the customer. Then the Branch Office will get approval from the customers and the copy of the approved drawing will be sent to the factory at Ghaziabad for planning the manufacture of the spares of the lifts at Ghaziabad by duly mentioning the job number. The Branch Office will thereafter be duly intimated by the factory regarding the development of the production and the Branch Office will also be intimated about the completion of the project and the lifts will be dismantled and despatched from the factory directly to the customer site. The Branch Office will thereafter be duly intimated by the factory regarding the development of the production and the Branch Office will also be intimated about the completion of the project and the lifts will be dismantled and despatched from the factory directly to the customer site. On being informed so, the materials will be either taken delivery by customer or by their technical representative and thereafter, the technician will be sent from the Branch Office for erection of the lift at site. Thus, the modus operandi is that the goods will be manufactured at Ghaziabad factory according to the specifications given in the job order indicated by the customer by the Branch Office and thereafter, finished article will be despatched from Ghaziabad factory to the customer site, outside the state and be taken delivery by the customer and erected by the assessee's technician at customer's site. 3. Likewise, the assessee was placed with an order by customer for designing, manufacturing, supply, installation, testing and commissioning of one number of passenger ECE Elevators at Polimer Cabel Network, Salem. The job order in respect of other customers were also similarly worded as in this case. After completion of the project, the assessee treating the transaction as inter-state works contract claimed deduction under Section 3-B(2)(a) of the Tamil Nadu General Sales Tax Act. The Assessing Officer having accepted the claim of the assessee granted the relief. Thereafter, there was a revision of assessment at the instance of the Revenue based on the inspection of Enforcement Wing Officials on 17.4.2002. During the course of inspection, the Enforcement Wing Officials seized documents relating to despatch of goods, such as delivery challan, wherein, the consignor is noted as "ECE Ghaziabad" and the consignee is noted as "ECE Industries Limited care of clients address" as per the particulars of the challan, the materials are received and taken charge by the site Engineers. The verification of the returns disclosed that the assessee's work contractors have not paid any sales tax on the above transactions in Tamil Nadu. The ECE Industries Limited, Ghaziabad have not raised invoices for the sales of the materials involved in the works contract and the Branch Office at Chennai had actually raised invoices for the value of the goods. The goods have not been subjected to Central Sales Tax. The ECE Industries Limited, Ghaziabad have not raised invoices for the sales of the materials involved in the works contract and the Branch Office at Chennai had actually raised invoices for the value of the goods. The goods have not been subjected to Central Sales Tax. On the basis of the materials, it was decided that the nature of the transaction in question is not interstate sale and they are pure and simple local sales. In pursuance of the same, a notice was issued by the Enforcement Wing Officials to the assessee calling for the records from the assessee in support of their claim on deduction under Section 3-B(2) of the Tamil Nadu General Sales Tax Act. In response to the notice, the assessee also filed their objections reiterating their claim that the sale is only interstate. However, the Assessing Officer did not accept the claim made by the assessee regarding the nature of transaction. It was decided by the Assessing Officer that it is only local sales and exemption is disallowed, besides, levying penalty at 150%. 4. Aggrieved against the same, the assessee preferred an appeal before the lower Appellate Authority. The lower Appellate Authority, in paragraph 7 of its order found that lifts are manufactured at Ghaziabad and sent to the customer's site for erection and invoices raised from the Ghaziabad factory mentioned the name of the ultimate buyer and exercise duty was charged by the Factory. The delivery invoice and L.R. also stated the consignee as Erection : Engineer ECE Industries Limited., C/o. Erode Kalvi Nilayam or Shanthi Hospital or Sirushri Constructions i.e. name of the ultimate buyer. As such there was a link or nexus between the work order received by the assessee from the customer within State of Tamil Nadu and the movement of goods originated from outside Tamil Nadu into Tamil Nadu for work at customer's site. As such, the transaction was interstate sale and hence the assessee is eligible for deduction under Section 3-B(2) of the Tamil Nadu General Sales Tax Act and accordingly, reversed the Assessing Officer's finding regarding the levy of tax and also penalty. 5. Aggrieved against the same, the Revenue preferred further appeal before the Tamil Nadu Sales Tax Appellate Tribunal. The Tribunal by relying on the decision of the Honourable Apex Court reported in 88 STC 204 – GANNON DUNKERLY AND CO. 5. Aggrieved against the same, the Revenue preferred further appeal before the Tamil Nadu Sales Tax Appellate Tribunal. The Tribunal by relying on the decision of the Honourable Apex Court reported in 88 STC 204 – GANNON DUNKERLY AND CO. AND OTHERS v. STATE OF RAJASTHAN AND OTHERS observed that the manufacturing activity was done at Ghaziabad as per the specifications given by the customer in the job order which was received by the assessee in Tamil Nadu and after completion of the work, the factory at Ghaziabad despatched the goods by describing the consignor as "ECE Ghaziabad" and the consignee as "ECE Industries Limited care of clients address" and the goods were received in the branch office, who in turn, sold it to the customer within Tamil Nadu and hence, nature of the transaction is local sales at TamilNadu, as such, assessable to tax under Section 3(2) of the Tamil Nadu General Sales Tax Act. While deciding so, the Tribunal also followed the decision of the Apex Court reported in 144 STC 605 – STATE OF KARNATAKA AND OTHERS v. ECE INDUSTRIES LIMITED and held that the dealer had stock transferred the dismantled parts to the Branch Office in Tamilnadu, who in turn effected local sales to the ultimate customer and hence, the nature of transactions is not inter state sales, but this is only pure and simple local sales, and assessable to tax under Section 3(2) of the Tamil Nadu General Sales Tax Act and set aside the order of the first Appellate Authority and restored the order of the Assessing Officer as regards the quantum of assessment. As far as levy of penalty is concerned, the Tribunal has held that the same is not warranted and set aside the same. 6. Aggrieved against the same, the assessee has preferred the above revision before this Court by raising the substantial questions of law stated supra. 7. That being the factual state of affairs, the only point to be considered is as to whether the disputed transaction is local sales or interstate sales. 6. Aggrieved against the same, the assessee has preferred the above revision before this Court by raising the substantial questions of law stated supra. 7. That being the factual state of affairs, the only point to be considered is as to whether the disputed transaction is local sales or interstate sales. As already referred to by the Tribunal in paragraph 16 of its order, that customers placed order in the Branch Office in Tamil Nadu and only the Branch Office forwarded the order to the factory at Ghaziabad, wherein, lifts are manufactured according to the specifications of the customers and the factory at Ghaziabad after manufacturing the lifts, dismantled them and stock transferred them in parts to Branch Office in Tamil Nadu. They sent the goods directly to the customer's address whereas the Tribunal has erroneously found that the goods were sent to the Branch Office, who in turn sold the same to the ultimate customer. The goods sent to the customer site was taken delivery by the customer or by their authorised representative. What the Branch Office did was to send technician for the purpose of installation and erection, testing and commissioning of the lifts in the customer's site. The Tribunal failed to see that the consignee name is mentioned as "ECE Industries Limited care of clients address" in the delivery invoice only to indicate that the same is meant for customer's site and not despatched to the Branch Office. As the sale is already effected and as the manufacture of the lift at Ghaziabad is only in pursuance of job order evidencing interstate sales, the question of further sale by branch office does not at all arise herein. The Tribunal has erroneously arrived at the conclusion that the goods were sent to the Branch Office at Tamil Nadu, and it is only the Branch Office, who in turn effected sale to the ultimate customer, thereby, treated the disputed transaction as pure and simple local sales. Thus, there is an error in the reasoning of the Tribunal resulting in rejecting the claim of the assessee. 8. Learned counsel for the assessee pointed out to the Division Bench judgment of the Karnataka High Court cited supra viz., 144 STC 605 – STATE OF KARNATAKA AND OTHERS v. ECE INDUSTRIES LIMITED, wherein also similar issue was raised and the Karnataka High Court decided the issue in favour of the assessee. 8. Learned counsel for the assessee pointed out to the Division Bench judgment of the Karnataka High Court cited supra viz., 144 STC 605 – STATE OF KARNATAKA AND OTHERS v. ECE INDUSTRIES LIMITED, wherein also similar issue was raised and the Karnataka High Court decided the issue in favour of the assessee. In paragraph 26 of the judgment, the Karnataka High Court held that it is only a interstate works contract and it cannot be stated that it is a local sale exigible to levy of tax under the relevant provisions of law. The facts of the present case is also identical to that of the case decided by the Karnataka High Court and we find no ground to disagree with the view expressed by the Karnataka High Court in the judgment cited above. 9. The facts of the case dealt with by the Supreme Court reported in 140 STC 22 – STATE OF ANDHRA PRADESH v. KONE ELEVATORS (INDIA) LIMITED, and the facts narrated herein are distinguishable. In the case decided by the Supreme Court, the nature of the business carried on by the assessee therein was only manufacturing and supply. On the basis of the materials available in the case, the Supreme Court concluded that the transactions disputed in the said case was local sales and not interstate sales, whereas, in the present case, there are sufficient materials to show that the nature of the transaction is interstate sales cum works contract. In the decision of the Supreme Court it was pointed out that a combined study of the above models, mentioned in the brochure, indicated that the assessee has been exhibiting various models of lifts for sale and these lifts are sold in various colours with various capacities and variable voltage. According to the brochure, it is open for a prospective buyer to place purchase order for supply of lifts as per his convenience and choice. Therefore, the assessee satisfied, on facts, the twin requirements to attract the charge of tax under the Andhra Pradesh General Sales Tax Act. But, the materials herein revealed different picture. According to the brochure, it is open for a prospective buyer to place purchase order for supply of lifts as per his convenience and choice. Therefore, the assessee satisfied, on facts, the twin requirements to attract the charge of tax under the Andhra Pradesh General Sales Tax Act. But, the materials herein revealed different picture. Here is the case where the goods are customised one and manufactured as per the specifications of the customers and the movements of the finished goods from Ghaziabad to Tamil Nadu was only in pursuance of the sale cum contract and no sale was effected after the goods moved into Tamil Nadu. Thus, the nature of transaction clearly shows that it is only interstate works contract, considering the predominant nature of the order placed by the customer for designing, supply, installation, erection, testing and commissioning of the lifts and the assessee is hence entitled to deduction as claimed under Section 3-B(2)(a) of the Tamil Nadu General Sales Tax Act. As such, the order of the Tribunal to the contrary is liable to be set aside. 10. In the circumstances, the Tax Case (Revision) stands allowed. No costs. Consequently, connected MP is closed.