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2023 (9) TMI 54 - HC - VAT and Sales TaxTaxability - Deemed sale or not - receipts towards royalty and the transfer of the right to use intangible property - HELD THAT:- A reading of the judgment in Quick Heal Technologies [2022 (8) TMI 283 - SUPREME COURT] clearly shows that the issue is not whether there is a transfer of property in goods but if there is a transfer of the right to use the property in goods. The first Appellate Authority and the Tribunal essentially held that there is no exclusive transfer of the goods and that the decision of the Division Bench in Malabar Gold regarding the trademark would come to the rescue of the assessee. The judgment in Malabar Gold [2013 (7) TMI 101 - KERALA HIGH COURT] has not become final as it is challenged before the Supreme Court. That apart, it cannot be held that it is a requirement of law that there should be a transfer of the entire right to the exclusion of the transferor for there to be a transfer of the right to use. The transfer of the right to use goods is distinct and separate from the transfer of goods. Thus, it has to be held that in a contract for the transfer of the right to use the goods, the taxable event is the execution of the contract for delivery of the goods, and if that has taken place, it was immaterial whether the transfer was exclusively or to the exclusion of all others. In the instant case, the transferee obtained a legal right to use the goods for the period during which he had such legal rights, which had to be to the exclusion of the transferor - the Tribunal has clearly gone wrong in law while dismissing the appeals preferred by the State. The order of the Tribunal impugned before us is set aside. Case remitted back to the assessing officer to consider the question afresh and pass a speaking order dealing with the contentions of the assessee. The questions of law are answered in favour of the State and against the assessee - revision disposed off.
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