Transfer of right to use goods requires effective control and possession; transportation charges for tank trucks were not taxable.

Tax under Section 3-F of the U.P. Value Added Tax Act applies only when there is a transfer of the right to use goods. On the transport arrangement described, the transporter retained control, custody and possession of the tank trucks, bore operating expenses, employed the drivers and staff, and remained responsible for the vehicles. The recipient could use the trucks only for specified transportation work and did not obtain effective control or possession. In the absence of delivery of possession and transfer of effective control, the transaction was not a transfer of the right to use goods, so the levy under Section 3-F was not attracted and the revision was allowed.

---

---

Issues: Whether tax under Section 3-F of the U.P. Value Added Tax Act was exigible on transportation charges paid for tank trucks where the owner retained control, custody and possession of the vehicles.

Analysis: Section 3-F applies only where there is a transfer of the right to use goods. On the terms of the transport arrangement, the transporter retained control over the tank trucks, bore the operational expenses, employed the drivers and staff, and continued to be responsible for the vehicles. The recipient of the service could use the vehicles only for the specified transportation work and did not obtain effective control or possession of the vehicles. In the absence of delivery of possession and transfer of effective control, the transaction did not amount to a transfer of the right to use goods.

Conclusion: The levy under Section 3-F was not attracted and the assessee's revision was allowed.

---