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of <h1>Sales Tax Applies to Telephone Sets, Modems, and Caller ID Instruments; Deposit Levy Issue Remanded Under Relevant Tax Rules</h1> <h3>BHARAT SANCHAR NIGAM LTD. THRU ITS CHIEF GENERAL MANAGER Versus THE STATE OF ANDHRA PRADESH REVENUE DEPARTMENT</h3> The SC upheld the HC's decision that sales tax applies to transactions involving telephone sets, modems, and caller ID instruments. The Court found no ... Levy of sales tax - transactions relating to telephone sets, modems and caller IDs instruments - non-refundable deposits and refundable deposits - HELD THAT:- Matter related to Levy of sales tax on non-refundable deposits and refundable deposits was remanded by High Court - It was held by High Court that the transactions relating to telephone sets, modems and caller IDs instruments are subject to sales tax levy. This Court is of the opinion that no interference is called for especially in view of the fact that the High Court has taken note of all the decisions on the point - Petition dismissed. Issues involved: Interpretation of sales tax levy on Value Added Services, SIM Cards, and related items.Summary:The Supreme Court considered multiple special leave petitions regarding the levy of sales tax on Value Added Services, SIM Cards, and related items. The States of Andhra Pradesh and Telangana argued that the impugned judgment, which held that Sales Tax is not applicable to these items, cannot be supported. They cited the case of 'Tata Consultancy Services vs. State of A.P.' where it was held that the medium on which software is embedded are goods and subject to sales tax.The Andhra Pradesh High Court's judgment referred to the case of 'Idea Mobile Communication Ltd. vs. CCE & Customs' which stated that services provided by 'Telecom Service Provider' are subject to levy under the Finance Act, 1994. The High Court concluded that SIM Cards, Rechargeable Coupons, Fixed Monthly Charges, and Value-Added Services are not considered 'goods.' It also referred to other judgments including 'Bharat Sanchar Nigam Ltd. vs. Union of India' and 'Associated Cement Companies Ltd. vs. Commissioner of Customs.'The High Court remitted the matter for consideration regarding the levy of sales tax on non-refundable and refundable deposits, as well as transactions related to telephone sets, modems, and caller ID instruments. The Supreme Court, after reviewing the submissions and the impugned judgment, decided not to interfere, noting that the High Court considered all relevant decisions on the matter. In a recent judgment, the Court held that customized engineering drawings are services and subject only to service tax under the Finance Act, 1994.Consequently, the special leave petitions and the related case are dismissed, and all pending applications are disposed of.
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