Transfer of right to use goods test excludes mere hire of immovable advertisement hoardings from sales tax levy.

Leasing of advertisement hoardings was not taxable under section 5E because the decisive test was whether there was a transfer of the right to use goods. The hoardings were found to be permanently fixed and therefore immovable property, so the arrangement was treated as mere hiring rather than a taxable transfer of goods. On that basis, the levy under section 5E did not apply. A transaction involving advertisement hoardings attracts tax only when the right to use goods is actually transferred; mere hire of immovable hoardings falls outside the charging provision.

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Issues: Whether the leasing out of advertisement hoardings attracted tax under section 5E of the Andhra Pradesh General Sales Tax Act.

Analysis: The dispute turned on the true nature of the transaction. The hoardings were found to be permanently fixed and to constitute immovable property. The earlier decision relied upon held that the decisive test is whether there is a transfer of the right to use goods; where the arrangement is only for hire charges and no such transfer is established, the transaction is not taxable under section 5E.

Conclusion: The transaction was not liable to tax under section 5E.

Ratio Decidendi: A transaction concerning advertisement hoardings is taxable only if it involves a transfer of the right to use goods; mere hiring of immovable hoardings does not attract levy under section 5E.

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