Intellectual Property Sale -Service Tax Applicability

[Binu Karuthedath]

Dear Sir

One of the Assesse have to sale their registered Brand Name(Intellectual Property) to another Indian Company with consideration .What are the Tax applicability of the sale of Intellectual property

AI Summary

Tax Implications on Selling Brand Names: Service Tax or VAT? Agreement Terms are Key. An individual inquired about the tax implications of selling a registered brand name to another Indian company. A respondent clarified that the transaction could be subject to either Service Tax or VAT, depending on the agreement's terms. The sale of intellectual property rights is not explicitly listed as a declared service under the Finance Act, 1994. Another participant referenced a Bombay High Court decision, which stated that VAT could apply to the transfer of rights to use intangibles, even if transferred to multiple users. The discussion emphasized the importance of reviewing the agreement to determine tax liability.