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2013 (5) TMI 540 - HC - VAT and Sales TaxTransfer of right to use the goods - Exigible to sales tax - Whether hiring of cinematographic equipments would amount to "transfer of right to use the goods" for cash, exigible to sales tax under Section 3-A of the Tamil Nadu General Sales Tax Act, (in short, TNGST Act")? – Held that - Whether a transaction is a transfer of right to use goods or a service is essentially a question of fact, which has to be determined in each case, having regard to the terms of the contract. As pointed out earlier, in the present case, the assessee(s) have not produced any document/agreement to show that the assessee(s) retained possession and control over the Cinematographic equipments leased out. In the absence of any material evidence, we find no sufficient reasons to upset the concurrent findings recorded by the authorities and the Tribunal and questions of law are answered accordingly. Whether the Tribunal is justified in upholding the penalty, when the question of liability to tax itself is a debatable issue? – Held that - Assessment order was made based upon the registers seized from the premises of the assessee(s), which were inspected. Even though the Department contends that the assessee(s) have not maintained proper accounts, the assessment was made based on various registers. In Appollo Saline Pharmaceuticals (P) Ltd. Vs. Commercial Tax Officer (FAC) and others, [2001 (10) TMI 1100 - MADRAS HIGH COURT], this Court held where the assessment was based on return and accounts, penalty is not leviable. Applying the ratio of the said decision, in the present case, even though the assessee(s) have not maintained the accounts, the assessment was made based on the registers seized from the premises of the assessee(s) and therefore the penalty cannot be levied. The penalty levied on the assessee(s) are not sustainable and set aside.
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