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2009 (6) TMI 935 - HC - VAT and Sales TaxWhether, on the facts and in the circumstances of the case and on a true and correct interpretation of section 2(10) of the Maharashtra Sales Tax on the Transfer of the Right to use any Goods for any Purpose Act, 1985, the Tribunal was justified in holding that the impugned transaction does not amount to a sale under the provisions of the Lease Act? Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that even after consideration that the constructive possession of the computer being given to the contractee mentioned in the impugned invoice the computer continues to be under effective control of the respondents-contractor and, therefore, transfer of right to use the computer by the contractee could not be held to have taken place as covered by the term 'sale' occurring in the Lease Act? Held that:- In the present case, from the facts noted earlier, it is clear that the goods, i.e., computers and terminals were always in possession of the respondents. They were never delivered or handed over to the ONGC. It may be that as per the requirement of ONGC, fixed time was assigned to them and during that fixed time of the day, staff members of ONGC would come to the office of the respondents to get their work done but during all that period, computers would be operated by the employees of the respondents and not by the employees of the ONGC. In view of the language of sections 3 and 4 tax shall be leviable on the turnover of sales in respect of transfer of right to use any goods. Unless there is transfer of right to use any goods, the provisions of the said Act will not be attracted and sales tax cannot be levied on such transactions. Taking into consideration the nature of the contract between the respondents and the ONGC and the legal position, it must be held that the Tribunal correctly interpreted the provisions of section 2(10) of the Act while holding that the transaction is not taxable. Decided in favour of the respondents and against the Revenue.
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