475 A.2d 343 | Conn. Super. Ct. | 1982
This is an appeal by the plaintiff pursuant to General Statutes §
The parties have submitted an agreed statement of facts which is made a part of the record. Briefly summarized, it appears that the plaintiff, a general contractor, had, from March 1, 1976, through February 28, 1979, made contracts with the state through its department of transportation for highway and bridge construction. Each contract required the plaintiff to provide watchmen, police of the city of Stamford and state police as traffic officers, and flashing lights for installation on signs and barricades furnished by the state. The duties, attire, equipment, working hours, and compensation of watchmen and traffic officers were specifically detailed in the contracts. The locations at which and the periods of time for which each watchman or traffic officer must serve, and his duties, were subject to the order and direction of the state engineer limited only by specified conditions applying to the state police officers to recognize state police department authority. The lights, the power and type of which were specifically described, were required to be placed and maintained on the state's own signs and barricades or elsewhere as directed and ordered by the state engineer. At the end of each job the plaintiff was ordered to dispose of the lights.
From March 1, 1976, through February 28, 1979, the plaintiff purchased the services of watchmen and traffic officers from private agencies and from the police department including the state police for $280,020.13 and issued "Resale Certificates" for the purchases. The department of transportation paid the plaintiff for the purchases at the agreed contract price amounting to $272, 468.58. During the same period the plaintiff rented flashing lights for $27,383.17 and issued "Resale *236 Certificates" to the provider. The lights were rented to meet the contract requirements and the department of transportation paid the plaintiff $21,355.50 for the lights at the agreed contract prices.
Prior to December 28, 1979, the department of revenue services conducted a sales and use tax audit of the plaintiff's business for the period from March 1, 1976, through February 28, 1979, and assessed a sales and use tax deficiency of $11,818.19 on the basis of the plaintiff's purchase of the services of watchmen and traffic officers and $1,916.82 based on the plaintiff's rental of flashing lights.
The plaintiff promptly petitioned for an oral hearing pursuant to General Statutes §
The plaintiff claims that the services of watchmen and traffic officers were purchased and the lights were rented with the intent to resell them to the state which is a tax exempt entity.
The defendant claims that the services of the watchmen and traffic officers and the rental of lights were not resold to the state, a tax exempt entity, but all were merely used by the plaintiff in performing its contracts and it is not in the business of reselling any of the items.
General Statutes §§
General Statutes §
General Statutes §
General Statutes §
General Statutes §
The plaintiff paid no sales or use tax on the purchased services or rented lights and there is no claim that the plaintiff acquired them as an agent of the state. In general, a sales tax is imposed on articles acquired within the state and a use tax is imposed on those acquired from outside the state. Except for the services of the city of Stamford or state police officers, the source of the plaintiff's acquisitions is not disclosed. On the agreed facts no distinction is necessary in determining the plaintiff's tax liability. The basic issue is whether the items involved became, under the contracts between the parties, contracts for services or contracts to sell the items to the state. If they were "merely incidental to a special service performed for the [state]" the plaintiff is liable for the tax. United Aircraft Corporation
v. O'Connor,
The state had contracted with the plaintiff, through its department of transportation, for the construction of highways and bridges. The responsibility of the state to provide for the safety of the public during that operation by closing or restricting traffic and providing lighted warnings of danger was basic. General Statutes §§
It is concluded that the plaintiff's purchase of the services of watchmen and traffic officers and the rental of lighting equipment was not a "use" of those items by the plaintiff but rather that it was a sale of those items to the state, a tax exempt agency. General Statutes §