The main legal point established in the judgment is that the transfer of the right to use any goods for any purpose is subject to sales tax under the Tripura Sales Tax Act, and the validity of Rule 3A(2) of the Tripura Sales Tax Rules, which mandated deduction of 4% of the dues of such a transfer, was held to be ultra vires the Act.

I.A. Ansari, J.

1. Is 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, subject to levy of sales tax under the Tripura Sales Tax Act, 1976 (in short, 'the TST Act') and if so, who is liable to pay such a tax, are two important questions raised in this series of appeals.

2. Yet another question, raised in the present set of appeals, is as to whether Sub-rule (2) of Rule 3 A of the Tripura Sales Tax Rules, 1976 (in short, the 'TST Rules'), can be treated to be a valid piece of delegated legislation, when it mandates every person, responsible for making payment to the transfer of the right to use any goods for any purpose (whether or not for a specified period), to deduct an amount equal to 4 per centum of the dues of such a transfer towards part or full satisfaction of the sales tax payable, under the TST Act, on account of such transfer of the right.

3. Before we make endeavour to answer the questions posed above, it is imperative that some material facts, which have given rise to the present appeals, are taken note of. These facts are, in brief, set out as under:

(i) Being in need of hiring a large number of vehicles of different types for the purpose of smooth running of their work, the Oil and Natural Gas Commission (in short, 'the ONGC) and the Gas Authority of India Ltd. (in short "the GAIL") issued notices inviting tender asking interested parties/transporters to submit tenders for lending vehicles, on hire, for a specified period, to be used by the ONGC and the GAIL for their officers and staffs. Pursuant to the tender, so floated, some persons submitted their tenders and their offers having been accepted, the ONGC and the GAIL entered into agreements with the selected tenders for hiring different types of vehicles at different rates and accordingly issued work orders. Relevant extracts of the work orders, so issued by the ONGC and the GAIL, are reproduced hereinbelow as specimen:

To

M/s Swapan Kr Paul.

B.K. Road, Agartala

Tripura West

Sub: Work Order for supply one diesel driven Tourist Ambassador Car.

Dear Sir,

Subject to the terms & conditions contained in tender/contract No. AGT/1BG/TPT/CARS/7/97-98 and in continuation to the L.O.I, dated 23.03.98 you are requested to supply a Diesel driven tourist Ambassador car of model not earlier than 1996 for 12 hours duty on the following rates:

FOR 12 HOURS DUTY

Fixed Charge Rs. 410.00 per day

(Rupees four hundred ten only).

Running charge Rs. 3.90 per K.M.

(Rupees three and paisa ninety only).

Over time charge beyond - Rs. 35.00 per hr.

12 hours duty

(Rupees thirty five only)

outstation charge - Rs. 125/- per day

(Rupees one hundred twenty-five only)

* * * * * *

Yours faithfully.

Sd/-

Chief Manager (Logistics)

ONGC, Agartala.

To,

M/s. Chandan Deb

Near Circuit House: Kunjaban,

P.O. Abhoynagar: Agartala - 799005,

Tripura West.

Sub: Providing 05 nos Commander jeep on 12 hrs. Basis Against Tender No. GAIL/AGT/VEH/98-99/01.

Dear Sir,

With reference to your offer against our NIT No. GAIL/AGT/VEH/98-99/01 published in Various dailies of Agartala & Calcutta dated 13.01.99 & 14.01.99 and subsequently your letter dated 27.05.99, we are pleased to award the work to you at your quoted rates and laid down terms & conditions mentioned in the tender document for 05 Nos. of Commander jeep (Model 1998 onwards) on 12 hrs. basis immediately.

You are, therefore, requested to provide 05 nos Commander jeep on 12 hrs. basis immediately.

Failure to provide the vehicles requisitioned above within 15 days from the receive of this letter as mentioned in your letter dt. 27.05.99, would amount to not acceptance of the offer by you and this letter will stand cancelled.

An amount of Rs. 18,000/- (Rupees one eight zero zero zero only) for each vehicle is to be deposited with GAIL, Agartala, in the form of Bank Draft/Bank Guarantee/Cheque of any Nationalised Bank in favour of Gas Authority of India Limited, Agartala, towards Secu