Transfer of goods by way of hiring, leasing, licensing or in any other manner

Service tax applies to hiring, leasing, licensing goods without transferring usage rights; effective July 1, 2012.

The service tax implications on transactions involving the transfer of goods through hiring, leasing, or licensing without transferring the right to use. Effective from July 1, 2012, this tax applies when possession and control remain with the owner, as in hiring cranes or bank lockers. The Supreme Court has established criteria to determine if a transaction involves the transfer of the right to use goods, including the availability of goods for delivery and the transferee's exclusive legal right to use them. Examples provided indicate that mere permission to use goods does not constitute a transfer of possession and control.