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IN THE HIGH COURT OF KERALA AT ERNAKULAM
ZIYAD RAHMAN A.A.
M.V. Viswanathan S/o. Velayudhan Pillai – Appellant
Versus
Kerala Water Authority – Respondent
| Table of Content |
|---|
| 1. petitioners are contractors and the contested deduction pertains to the cess act. (Para 1 , 2) |
| 2. challenge against deductions due to non-applicability of the cess act. (Para 3) |
| 3. statutory definitions relevant for the case. (Para 4 , 5) |
| 4. understanding cost of construction for cess determination. (Para 6 , 11) |
| 5. interrelationship of supply and construction activities is critical. (Para 8 , 12 , 18) |
| 6. cess not applicable to merely supplied materials when distinguished as such. (Para 20 , 23) |
| 7. permitting deductions while maintaining contractor's right to contest. (Para 27 , 28) |
JUDGMENT :
In all these Writ Petitions, the petitioners are contractors, who were awarded with the works by the Kerala Water Authority, mainly in connection with drawing of pipelines and other matters. The question that arises in these cases is with regard to the deduction proposed to be made from the contract amounts at the rate of 1% thereof, towards the payment of the Cess payable under the provisions of The Building and Other Construction Workers’ Welfare Cess Act, 1996, (hereinafter referred to as the “Cess Act”). In all these cases, interim orders were granted by this Court directing th
The court held that deductions for the cess on construction payments are valid under the relevant welfare legislation, affirming that activities like laying pipelines constitute construction work.
(1) Cess could only be recovered in the manner stipulated in Cess Act and Rules framed thereunder.(2) A contractor who enters into a pure Supply Contract is statutorily exempted from levy under BOCW ....
The main legal point established in the judgment is that the labour cess is not leviable on the supply of materials and consultancy charges under the Building and Other Construction Workers' Welfare ....
The imposition of 1% cess under the Building and Other Construction Workers Act is a statutory obligation aimed at benefiting workers, and is applicable despite claims regarding the Factories Act exe....
The main legal point established in the judgment is the importance of interpreting the statute by considering the text and context, and the applicability of the enabling provision of section 3(1-A) a....
Dredging activities fall within the definition of construction work under the BOCW Act, affirming cess obligations for such activities.
Cess under the Cess Act read with BOCW Act is leviable in respect of building and other construction works.
Taxes not to be imposed save by authority of law - Article 265 of Constitution is the source of power for the Union and States to impose taxes in accordance with law. Article 265 of the Constitution ....
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