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2015 (1) TMI 1043 - HC - VAT and Sales TaxAmount paid under contract of selling formed part of sale price or not - Whether the Tribunal was justified in holding that the “Airtime charges” and “License fees” charged under an contract of selling activated pager do not form a part of sale price within the meaning of Section 2(29) of the Bombay Sales Tax Act, 1959 – Held that:- In State of Karnataka vs. Bangalore Soft Drinks Pvt. Ltd. [1998 (9) TMI 539 - SUPREME COURT OF INDIA] it has been held that the Respondent has effected sales “exworks” and had also undertaken transport of the goods to the place of the buyer - The goods were transported in the vehicles of the Petitioners only - the transfer of the property in the goods takes place at the factory gate of the Petitioner and the subsequent transportation undertaken by the Petitioner was for and on behalf of the Petitioner as his agent - The obligation of transportation was construed to be as separate contract and therefore, the freight charges cannot be included in sale price of the goods - the goods which form part of the subject matter of the contract between the Respondent and its buyer were in a specific and deliverable state - The transfer of property in the goods in pursuance of the sale contract takes place against the payment of the price of goods - The delivery of the goods is effected by the seller to the buyer and the obligation under law to obtain registration of the motor vehicle is cast upon buyer - The service of facilitating the registration of the vehicle which is rendered by the seller-assessee is to the buyer and in rendering that service, seller acts as an agent of the buyer - The handling charges for this service cannot form part of sale price - Thus, taking overall view of the matter it is clear that the sale price does not include airtime charges and/or license fees – thus, sale price will be restricted to that of the hardware, namely, pager units and will not include the cost of airtime and license fees - the tribunal was justified in holding that airtime charges and license fees charged under the contract for selling activated pager do not form part of the sale price – Decided against Revenue.
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