Hon’ble Yashwant Varma, J.—This batch of revisions, which raise identical issues have with the consent of parties been taken up for disposal together. The issue itself relates to the validity of the action taken against the revisionist on an alleged breach of the provisions of Section 8D of the U.P. Trade Tax Act, 1948 (1948 Act).

2. Briefly stated, the revisionist has been held liable to pay a penalty in terms of Section 8-D(6) of the 1948 Act as consequence of its failure to deduct tax in respect of a works contract awarded by it. For the purposes of laying cables, the revisionist is stated to have awarded contracts to various parties. One such contract and the terms upon which the same was to be executed stands enshrined in an agreement dated 24 January 2002. The relevant terms of the said contract are as under:

“Whereas it has been decided to award the work of laying underground cable falling in the jurisdiction of Telecom District Bareilly to M/s A.A. Cables Layers Ltd., 25-A, Model Town Bareilly. M/s A.A. Cable Layers Ltd., 25-A, Model Town Bareilly.....

3. The contractor will co-ordinate between the BSNL and agencies like PWD/Municipality/BDA/UPSEB etc. for road cutting. Until road cutting permission is obtained, contractor will not get cable issued for laying.

4. The cable and other stores will be supplied by the BSNL. The contractor will execute the work strictly according to the work order and diagram supplied by the BSNL as per BSNL specifications and standards under the supervision of BSNL officers.

5. The BSNL will not take any responsibility for providing any facility to the labours employed by the contractor. The BSNL will supply underground cable, joining kits, DP boxes, cabinets and other store items required for the job. The contractor will be responsible for their safety and in case of loss to BSNL property, the contractor will have to pay for the losses or the same will be adjusted towards his bills or security money etc.

6. digging or trenching should be made at a standard depth of one meter or 1.65 meter (as the case may be.)........

10. The cable is to be laid as soon as trenches are ready and should not be left till the whole length is dug up..........

13. The contractor has to abide by the terms & conditions of trenching/cable laying/joining and termination of laid cables fixed by GMTD, BR. 90% payment of the value of the work done will be made against bills in support of actual physical work completed and put to use certified by unit officer........... GMTD, BR however, shall reserve the right to pay the balance 10% amount amount of a particular work, after the completion of work, if he is satisfied with the performance of the contractor.”

3. By a notice which stands appended as Annexure-2 to the revision, the assessee was called upon to show-cause why penalty be not imposed upon it in terms of sub-section (6) consequent to a failure on its part to deduct tax from payments made to the contractor in the course of execution of a works contract. The revisionist furnished a reply whereafter an order was passed on 23 September 2003 holding it liable to pay a sum of Rs. 12,79,033/- as penalty in terms of Section 8-D(6). The order notes that in the execution of the works contract, the contractor while laying cables also utilized stone, bajri and other like items, the property in which goods, is stated to have been transferred to the revisionist in the execution of the works contract. It was therefore, held that the revisionist had failed to deduct tax and was consequently liable to suffer a levy of penalty. The issue was taken by the revisionist in appeal wherein it was asserted that all materials including underground cables, joining kits, DP boxes, cabinets etc. were provided by the revisionist itself to the contractors. It was contended that the contract in essence was not a works contract and did not involve any building, construction or manufacturing process. It was submitted that the contract i