TMI Blog2009 (11) TMI 823X X X X Extracts X X X X X X X X Extracts X X X X ..... ich was followed by us in the case of Jojo Frozen Foods (P) Ltd. v. State of Kerala (2008 (6) TMI 564 - KERALA HIGH COURT), we are of the opinion that the questions of law framed by the assessee require to be answered against the assessee and in favour of the Revenue. Accordingly, the revision petition is rejected. - Sales Tax Revision No. 299 of 2008 - - - Dated:- 3-11-2009 - DATTU H.L. C.J. AND BASHEER A.K. , JJ. ORDER:- The order of the court was made by H.L. DATTU C.J. The assessee is engaged in the manufacture and sale of ice-creams and is the trade mark holder of SKEI . During the course of its business, the assessee-company has entered into agreements with certain other units and appointed them as franchisees to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income received by the assessee from the franchisees for the use of the trade mark 'SKEI' on their products (icecreams) is exigible to tax under the Kerala General Sales Tax Act, 1963 in the hands of the assessee? (B) Whether under the circumstances of this case, it can be said there exists the concept of 'goods', 'turnover' and 'taxable turnover' with reference to the receipt of royalty by the assessee from their franchisees? In Jojo Frozen Foods (P) Ltd. v. State of Kerala (S.T. Rev. No. 12 of 2006) disposed of on June 23, 2008 See page 327 supra., this court after following the observations made by this court in the case of Mechanical Assembly Systems (India) Pvt. Ltd. v. State of Kerala [2006] 144 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gramme. But the moment copies are made and marketed, it becomes goods, which are susceptible to sales tax. Even intellectual property, once it is put on to a media, whether it be in the form of books or canvas (in case of painting) or computer discs or cassettes, and marketed would become goods . We see no difference between a sale of a software programme on a CD/floppy disc from a sale of music on a cassette/CD or a sale of a film on a video cassette/CD. In all such cases, the intellectual property has been incorporated on a media for purposes of transfer. Sale is not just of the media which by itself has very little value. The software and the media cannot be split up. What the buyer purchases and pays for is not the disc or the CD. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o mean aggregate of the amounts of sale price received or receivable during the year by a dealer in respect of the transfer of the right to use any goods. 'Sale price' has been defined in clause (11) of section 2 to mean the amount of valuable consideration received or receivable for the transfer of the right to use any goods for any purpose. The transfer of right to use any goods for any purpose is regarded as 'sale' under the Act as is evident from the definition of 'sale' in clause (10) of section 2 of the Act which defines 'sale' to mean transfer of any right to use any goods for any purpose for cash, deferred payment or any other valuable consideration. From a conjoint reading of the above provisions, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Admittedly, by agreement between the assessee and M/s. Salstar Foods Beverages Ltd., there was a transfer of right to use the trade mark to M/s. Salstar Foods Beverages Ltd. The royalty of Rs. 1,500 was payable in respect of transfer of the right to use the trade mark. Such transfer clearly falls within the provisions of the 1985 Act. 7.. 'Trade mark' has been defined in section 2(1)(v) of the Trade and Merchandise Marks Act, 1958 to mean a mark used in relation to goods for the purpose of indicating a connection in the course of trade between the goods and some person having the right, either as a proprietor or as registered user, to use the mark whether with or without any indication of the identity of that person. There is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in case of trade mark is different. For transferring the right to use the trade mark, it is not necessary to hand over the trade mark to the transferee or give control or possession of trade mark to him. It can be done merely by authorising the transferee to use the same in the manner required by the law as has been done in the present case. The right to use the trade mark can be transferred simultaneously to any number of persons. The decision of the Andhra Pradesh High Court in Rashtriya Ispat Nigam Ltd. v. Commercial Tax Officer [1990] 77 STC 182 thus has no application to the transfer of right to use a trade mark. In S.P.S. Jayam and Co.'s case [2004] 137 STC 117, the Madras High Court has held as under: (page 126) 8. Comi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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