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Analysing the Judgement of Hon ble Bombay HC holding meal vouchers as Goods & Implications

Value Added Tax - VAT and CST - By: - CA.Ankit Gulgulia - Dated:- 27-5-2015 - Recently the Hon ble High Court of Bombay have pronounced an order which is a land mark judgment for Indian E-commerce Industry specifically and including Coupon / voucher sub-industry considering the vacuum of judicial pronouncements on this aspect. The matter relates to CWP No. 5653 of 2010 & 7503 of 2013 decided on 20th March, 2015 in case of M/s Sodexo SVC India Private Limited vs. The State of Maharasthra & .....

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Sodexo Meal Vouchers ( Vouchers ). Sodexo enters into a contract with its customers for issuing the said vouchers (Say ₹ 100/- face value). The customers in turn distribute the said vouchers to their employees who are the actual users of the said vouchers. It is stated that Sodexo has contracts with various affiliates such as restaurants, departmental stores, shops, etc. Under the affiliate contracts, the affiliates are required to provide food and other items on presentation of the said v .....

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system for issue of meal and gift vouchers in the form of 'paper based vouchers' and 'smart meal cards' with effect from 25th June 2009. The Issues Whether the Sodexo Meal Vouchers are goods for the purposes of levy of Octroi and LBT ? Whether a Municipal Corporation constituted under the Maharashtra Municipal Corporations Act, 1949 is entitled to levy and/or collect Octroi or Local Body Tax (LBT) on Sodexo Meal Vouchers in accordance with the provisions of the Maharashtra Muni .....

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wn on the other provisions of the Act i.e. Octroi or LBT can be levied on the consumption, use or sale of goods within the limits of Municipal Corporations. The said vouchers are a medium to acquire any article for consumption, use or sale and the said vouchers are not capable of consumption, use or sale by themselves. Simply to say that the said vouchers are only medium of payment. Vouchers are similar to Lottery tickets which held not be goods by relying on Sunrise Associates v. NCT of Delhi .....

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He also relied on other judgements viz Bharat Sanchar Nigam Ltd. and Another v. Union of India and Others 2006 (3) TMI 1 - Supreme court & TATA Consultancy Services v. State of Andhra Pradesh 2004 (11) TMI 11 - Supreme Court for laying down the characteristics of goods and justifying as to said vouchers do not stand as goods within the prescribed characteristics. Revenue s Contention Revenue simply relied upon on the thesis that said vouchers were capable of use and/or consumption as well .....

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er they are brought into the limits of the City. In fact, going by the scheme narrated above, the said vouchers are sold by the petitioner to its customers for value. Relying on Tata Consultancy services (supra), court pointed that (Para 81) Citing the examples of several instances viz lottery tickets, Fixed deposit receipts and electromagnetic waves held that such printed paper vouchers are in the nature of goods and are not in the nature of actionable claim. The said voucher cannot be equate .....

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