Transfer of right to use goods tax turns on where the contract is concluded absent a fixed statutory situs.

Tax on transfer of the right to use goods under Article 366(29A)(d) arises on the transfer itself, and where legislation does not fix a special situs, the taxable event occurs where the contract is concluded. Applying contract law, the Court held that acceptance must be communicated to the proposer unless a special mode is proved. On the facts, the agreement for transfer of trademark and franchise rights was treated as concluded at NOIDA, so the VAT assessments were within jurisdiction and the challenge that the contract was executed outside Uttar Pradesh failed. The Court noted that the quantum of assessment was not in issue in the writ petitions.

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Issues: Whether the impugned VAT assessments lacked jurisdiction on the ground that the agreement transferring the right to use the trademark and franchise rights was executed outside Uttar Pradesh and, therefore, the taxable event did not arise within the State.

Analysis: The governing principle under Article 366(29A)(d) is that tax on transfer of the right to use goods is attracted on the transfer itself and, where no special situs is fixed by legislation, the taxable event occurs where the contract is executed. The Court applied the law of contract to determine where the agreement became concluded, holding that acceptance must be communicated to the proposer unless a special mode of communication is shown. On the facts, the offer originated from NOIDA and the record did not show any pleaded or proved special mode of communication taking the contract outside India. The agreement was therefore treated as concluded at NOIDA, and the petitioner's jurisdictional challenge failed. The Court also held that the quantum of assessment was not in issue in these writ petitions.

Conclusion: The assessments were within jurisdiction and the challenge based on alleged execution of the agreement outside Uttar Pradesh was rejected.

Final Conclusion: The writ petitions failed on the jurisdictional challenge and the assessment orders were sustained, leaving the assessee free to pursue the statutory remedy on the question of quantum, if available.

Ratio Decidendi: For tax on transfer of the right to use goods, where no legally fixed situs is shown, the decisive place is where the contract is concluded, and a contract is concluded where acceptance is communicated to the proposer.

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