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2. In O.P. No. 2016 of 1998 the petitioner is a dealer, manufacturing and selling pollution control equipments, steel plant machineries and spares wind electrical generators. His company has also been assessed to tax for 1995-96, overruling the claim of the assessee for exemption with regard to certain materials used in the works undertaken by him. The petitioner in this O.P. would allege that Section 3-B of the Act substituted by Act 25 of 1993 has been enacted in contravention of the Constitution of India and the words in Sub-section (2)(b) to Section 3-B "in the same form" are unwarranted as they place a restriction, which was not contemplated in the Constitution of India and the levy of tax on the deemed sales is contrary to Clause (29A) to Article 366 of the Constitution of India. He further stated that levy of tax on the transfer of property in the goods that are used in the execution of works contract is not in consonance with the constitutional provisions as the works contractor is unable to avail of second sales exemption in respect of First Schedule single point commodities and Second Schedule declared goods, unless the goods in question are transferred "in the same form". Therefore, this petitioner challenges the validity of Section 3-B(2)(b) of the Act. The petitioner in T.P. No. 2971 of 1997 is the skin and hide tanners merchants association serving for the cause of its members providing necessary assistance, especially in securing the materials for the business. This association also has alleged that Section 3-B of the Act is contrary to Clause (29A) to Article 366 of the Constitution making a deemed sale even for the works contract and in the contract of coolie for tanning or dyeing, there is no sale of any material and the rules framed thereunder to Section 3-B have fixed 30 per cent towards the labour to claim deduction and the rest of the 70 per cent is said to be the sale value which is taxable, that this percentage of labour charges fixed under Rule 6-B is arbitrary and therefore a writ of declaration has to be issued declaring that the sales tax on works contract in respect of the business of coolie for tanning and dyeing contract is illegal and ultra vires to the Constitution.

4. To put it concisely, from the averments of the affidavits, the validity of Section 3-B is attacked on three grounds. The first ground is the wording "in the same form" found in Sub-section (2)(b) to Section 3-B of the Act. The second ground is Section 3-B(2)(b) is contrary to the Article 366(29A) of the Constitution of India as the definition of "sale" under Section 2(n)(ii) is not in consonance with the Constitutional provisions under 46th Amendment to the Constitution. The third ground relates to the percentage fixed towards the labour charges at 30 per cent under Rule 6-B of the Tamil Nadu General Sales Tax Rules, 1959 which according to the petitioner is arbitrary.

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 4.       Watch and/or clock repair contracts       50

6. Section 3-B of the Act has been substituted after the 46th Amendment to Article 366 of the Constitution and Clause (29A) is the relevant passage in the article which reads as follows :

(29A) 'tax on the sale or purchase of goods' includes,--

(a) a tax on the transfer, otherwise than in pursuance of a contract, of property in any goods for cash, deferred payment or other valuable consideration ;

9. This definition of "sale" is practically adopted from Article 366 of the Constitution and Clause (29A)(b) is repeated in Section 3-B of the Act. In [1993] 88 STC 289 (Larsen and Toubro Limited v. State of Tamil Nadu), the Madras High Court has observed as follows :

As a matter of fact, the amendment introduced to the definition of 'sale' in Section 2(n) of the main Act was in substance a repetition and incorporation of Clause (29A) of Article 366 of the Constitution of India. The constitutional validity and legality of the said amendment was the subject-matter of a decision of the Constitution Bench of the apex Court in Builders Association of India v. Union of India [1989] 73 STC 370 and the same was upheld by the apex Court.