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2014 (5) TMI 210 - MADRAS HIGH COURTTaxable turnover – Whether the expenses incurred in commissioning imported machinery by a dealer for its customer form part of the cost of machinery in order to attract tax liability under Tamil Nadu General Sales Tax Act, 1959 – Expenses of Commissioning import of machinery - Held that:- This court failed to understand how this aspect of rendering of technical assistance would form part of the agreement of purchase of the machinery - So long as the payment made had nothing to do with the transfer of property in any goods, and that the payment made was not on sale of any goods, payment on labour charges has always been held as outside the purview of the Act for the purpose of taxing it. However, where the consideration paid in an indivisible contract could not be apportioned and the cost of materials and labour charges and the divisibility was not possible, the courts took the view that such an indivisible contract would not be brought to tax, but where indivisible contract had divisibility in it, the payment made could be ascertained as one falling for labour charges and other for the goods, the jurisdiction to assess the sale provision was always there - 46th amendment made it possible for the State to treat the indivisible contract as a deemed sale and that by legal fiction, the turnover relating to labour was separated for the purpose of assessment of the purchase in goods - Even under the amended provision, labour would never form part of the turnover for the purpose of assessment - Since the payments were made only for technical services and to meet the expenditure of travel and stay, Tribunal order is confirmed - Consequently, Tax Revision is rejected – Decided against Revenue.
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