TMI Blog2024 (1) TMI 182X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the appellant have paid the VAT on the transaction being a deemed sale in terms of Article 366 (29A) of Constitution of India. Therefore, the renting of the equipment does not fall under the category of supply of tangible goods for use service . Following the above decision in the appellant s own case - the impugned order set aside - appeal allowed. - HON'BLE MEMBER (JUDICIAL), MR. RAMESH NAIR And HON'BLE MEMBER (TECHNICAL), MR. RAJU Shri Sachin Chitnish Shri Kiran Chavan, Advocate for the Appellant Shri Rajesh R Kurup, Superintendent (AR), for the Respondent ORDER RAMESH NAIR In the present case the issue involved is that whether the renting of Earth Moving Equipment by the appellant is liabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Shri Rajesh R Kurup, Learned Superintendent (AR) appearing for the revenue reiterates the findings of the impugned order. 4. On careful consideration of the submission made by both the sides and perusal of record, we find that on the identical arrangement of renting of equipment to various clients and under the identically worded contract this Tribunal in the appellant s own case at Mumbai bench reported at 2017 (48) STR 476 passed the following order: 5. We have carefully considered the submissions made by both sides and perused the records. 5.1 Section 65(105)(zzzzj) defines the taxable service in respect of supply of tangible goods for use as follows :- Taxable service means any service provided or to be provided t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se and operation of the equipment. Further Cl. 14 dealing with title and ownership specifically provides that equipment is offered by GIMMCO Ltd. only on rights to use basis . Cl. 15 relating to damages provides for compensation to be paid by the hirer to the assessee in case of damage to the equipment during the period of use. These responsibilities cast on the hirer clearly show that the right of possession and effective control of the equipment rest with the hirer; otherwise the hirer cannot be held responsible for misuse/abuse, safe custody/security, liability to settle disputes with third parties in relation to use etc. Further Cl. 4.3 of the agreement provides for charging of VAT at 12.5% on the monthly invoice value which shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransfer of the property in goods, but it is right to use property in goods; (2) Article 366(29A)(d) read with the latter part of the Clause (29A) which uses the words, and such transfer, delivery or supply would show that the tax is not on the delivery of the goods used, but on the transfer of the right to use goods regardless of when or whether the goods are delivered for use subject to the condition that the goods should be in existence for use; (3) in the transaction for the transfer of the right to use goods, delivery of goods is not condition precedent, but the delivery may be one of the elements of the transaction; (4) the effective or general control does not mean always physical control and even if the manner, metho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that date the service was not taxable. However, we, in our above findings, held that the service in question is not the service of Supply of tangible goods for use . In this position the main ground of the ld. Commissioner for dropping of demand does not exist and not relevant. Though the ld. Commissioner in a passing reference mentioned in the impugned order that the service prior to 16-5-2008 does not fall under the Business Auxiliary Service but not given the detailed findings. Therefore when the main ground for dropping of demand does not exist. The issue relates to demand prior to the period 16-5-2008 needs reconsideration. 7. As per our above findings, we pass following order : 1. Assessee s Appeal No. ST/654/2012 is allo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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