B.D. Agarwal, J.

1. All the aforesaid three writ petitions are being disposed of by this composite order since all the writ petitions have stemmed out of same facts and also identical legal question is also involved therein.

2. I have heard Shri V.K. Jindal, learned senior counsel for the petitioners and Shri N. Sailo, learned Additional Advocate-General, Mizoram for the respondents.

3. Petitioner No. 1 is a Government of India Enterprise, having its head office at Shillong in the State of Meghalaya. The petitioner's company is engaged in power generation projects. Accordingly, the Government of Mizoram also engaged petitioner No. 1 to execute a hydro electric project in Kolasib District in the State of Mizoram. The name of the project has been given as Tuirial Hydro Electric Project, represented by the project head as petitioner No. 2. Petitioner No. 1 engaged one M/s. Patel Engineering Ltd., to execute civil/electrical works of the aforesaid power project. Accordingly, petitioner No. 1 entered into a written contract with the said private company. As per the terms of contract and memorandum of understanding, petitioner No. 1 (NEEPCO) would supply construction materials like cement, steel, M. S. plates, CGI sheets, HR sheets, etc., and the price of these materials would be deducted from the contractor's bill. As per the aforesaid agreement construction materials were supplied to M/s. Patel Engineering Ltd., without charging any sales tax. However, while importing the materials from outside the State of Mizoram M/s. NEEPCO had paid Central sales tax, but, the respondents have considered the supply of construction materials by M/s. NEEPCO to its contractor as a sale and the Superintendent of Taxes, Kolasib Circle has imposed sales tax and has also imposed penalty and interest for delay in deposit of sales tax.

4. W.P. (C) No. 91 of 2008 relates to assessment of sales, tax for the period July 1, 2002 to March 31, 2004, whereby sales tax of Rs. 62,31,168 and penalty of Rs. 11,070 have been assessed. These amounts have already been paid under protest.

5. W.P. (C) No. 92 of 2008 relates to assessment of sales tax, penalty and interest for the quarter ending of June, September and December, 2005. As per the rectification order dated December 2, 2005, passed by the Superintendent of Taxes, petitioner No. 1 is yet to deposit a sum of Rs. 61,001.

6. W.P. (C) No. 93 of 2008 relates to interest on the sales tax amount for the period July 1, 2002 to March 31, 2004, and the interest has been assessed at Rs. 14,74,389.

7. The assessment orders were challenged before the Deputy Commissioner of Taxes, who upheld the assessment orders. Accordingly revision applications were filed before the Commissioner of Taxes, Government of Mizoram. The Commissioner has no doubt upheld the assessment orders but has set aside the penalty imposed upon the assessee on the ground that penalty was imposed without giving prior notice or hearing of the assessee.

8. The main contention of Mr. Jindal, learned senior counsel for the petitioners, is that petitioner No. 1 cannot be termed as a "dealer" within the meaning of Section 2(10) of the Mizoram Sales Tax Act, 1989 nor the transfer of building materials to its contractor can be construed as "sale" under Section 2(19). According to the learned senior counsel to declare a person or a corporation as a "dealer" the authority must be satisfied that such person or corporation carries on business of sale of goods and such sales should be outright sale, including the transfer of ownership. According to the learned Counsel the materials supplied to M/s. Patel Engineering Ltd., were not for further sale or for use by the contractor in any other project and, as such, there was no absolute transfer of ownership of the materials. According to the learned senior counsel the materials were supplied to the contractor only to maintain the quality of the construction and the materials had to be used by the contractor only in the spe