TMI Blog2011 (4) TMI 1238X X X X Extracts X X X X X X X X Extracts X X X X ..... ngly, the writ petition is allowed and the impugned order dated April 23, 1993, annexure P4, to the extent of including in turnover transaction taking place outside the State of Haryana is quashed. - Civil Writ Petition Nos. 6691 of 1993 - - - Dated:- 4-4-2011 - ADARSH KUMAR GOEL AND AJAY KUMAR MITTAL, JJ. For the Appellant: Avneesh Jhingan For the Respondents : Gagandeep Wasu, Deputy Advocate-General, Haryana, JUDGMENT :- The judgment of the court was delivered by ADARSH KUMAR GOEL J.- This petition seeks quashing of section 2(gg) and 2(j) read with note 4 of the Haryana General Sales Tax Act, 1973 (hereinafter referred to as, the Act ) as amended. 2. The case of the petitioner is that it took some machiner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h note 4 of the Act. The said provision is as under: S. 2(j) 'Purchase' with all its grammatical or cognate expressions means the acquisition of goods for cash or deferred payment or other valuable consideration otherwise than under a mortgage, hypothecation, charge or pledge and includes,- (i) to (iii) . . . (iv) transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration. (v) . . . Note 1 to Note 3 . . . Note 4. A purchase falling under sub-clause (iv) shall be deemed to have taken place within the State if the goods in respect of which right to use has been transferred are within the State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be deemed to have been taken place inside the State. The said provision read with article 286 of the Constitution excludes competence of State Legislature to enact a contrary provision. 8. The learned counsel for the State supports the impugned provisions and the order passed with reference thereto. 9. After consideration of rival submissions, we are of the view that this petition is to be allowed. The deeming provision enacted by the State Legislature is in conflict with section 4(2)(a) of the Central Sales Tax Act, 1956. The matter is covered by the judgment of the honourable Supreme Court in 20th Century Finance Corpn. Ltd. [2000] 119 STC 182 (SC) wherein it was observed (pages 201 and 202 in 119 STC): We, therefore, find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he right to use goods. The various subclauses of clause (29A) of article 366 permit the imposition of tax thus: sub-clause (a) on transfer of property in goods; sub-clause (b) on transfer of property in goods; sub-clause (c) on delivery of goods; sub-clause (d) on transfer of the right to use goods; sub-clause (e) on supply of goods; and sub-clause (f) on supply of services. The words 'and such transfer, delivery or supply. . .' in the latter portion of clause (29A), therefore, refer to the words transfer, delivery and supply, as applicable, used in the various sub-clauses. Thus, the transfer of goods will be a deemed sale in the cases of sub-clauses (a) and (b), the delivery of goods will be a deemed sale in case of sub-clause (c), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eemed sale. Also of no relevance to the deemed sale is where the goods are delivered for use pursuant to the transfer of the right to use them, though it may be that in the case of an oral or implied transfer of the right to use goods, it is effected by the delivery of the goods. 10. Referring the impugned provision in note 4, it was observed (page 209 in 119 STC): Note 4 is substantially akin to Explanation impugned in the Maharashtra Act. Note 4 widens the ambit of definition of 'sale' by including outside sale, inter-State sale and import into the territory of India. Following the reasoning given earlier, we direct that Note 4 to section 2(1) of the Act shall be read down to this effect that it would not be applicable ..... X X X X Extracts X X X X X X X X Extracts X X X X
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