Immovable property hire charges fall outside the transfer of right to use goods under sales tax law.

Charges received for permitting use of permanently embedded oil storage tanks were not taxable turnover under section 3-A of the Tamil Nadu General Sales Tax Act because the levy applied only to transfers of the right to use goods. On the facts accepted, the tanks were huge storage structures embedded in the earth and therefore immovable property, not goods. As a result, hiring receipts for their use could not fall within the charging provision, and the show cause notice was quashed to that extent in favour of the assessee.

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Issues: Whether charges collected for permitting use of permanently embedded oil storage tanks constituted taxable turnover under section 3-A of the Tamil Nadu General Sales Tax Act.

Analysis: Section 3-A applied to transfers of the right to use goods. The tanks in question were huge storage structures permanently embedded in the earth and, on the facts accepted, were immovable properties. Since the statutory levy was confined to goods, the hiring charges received for allowing their use could not be brought within the charging provision.

Conclusion: The show cause notice was quashed to the extent it sought to treat the tank-hire receipts as taxable under section 3-A, and the issue was decided in favour of the assessee.

Ratio Decidendi: A charge for use of immovable property permanently embedded in the earth does not amount to consideration for the transfer of the right to use goods within the meaning of the sales tax charging provision.

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