AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2005 (8) TMI 649
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....to the factory and from factory to the residence and for which charges were stipulated. It was submitted that the possession of the vehicle was always with him and the entire expenses, namely, diesel charges, salary of driver/conductor, road tax, passenger tax, etc., have been borne by him and at no stage the right has been transferred to the aforesaid two companies to use the buses and thus, the assessee was not liable to tax under section 3F of the Act. The assessing authority has not accepted the plea of the assessee and levied the tax on the amount received from the aforesaid two companies under section 3F of the Act. Aggrieved by the assessment order, the assessee filed appeal before the Assistant Commissioner (Judicial), Trade Tax which was dismissed. The assessee filed appeal before the Tribunal that has been allowed by the impugned order. 3. Heard learned Standing Counsel and Sri Kunwar Saksena, learned counsel appearing on behalf of the assessee. 4. Learned Standing Counsel submitted that the order of the Tribunal is erroneous. He submitted that as per the agreement, the assessee had to provide the vehicles to the aforesaid two companies and whatever charges have been re....
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....inerals and Metals Trading Corporation of India Ltd., for transportation work including loading, unloading and stacking. The contention of the transporter was that there was no transaction of sale and that the contract was for purely labour and service. The department, however, contended that "hire charges" received by the transporter come within the definition of "sale price". Considering the enlarged definition of "sale" in view of the Constitutional amendment, the Orissa High Court held as follows: "In order to decide whether a transaction is of 'sale', the determinative factor is whether any transfer of right of user is involved. By way of illustration we may indicate that if 'A' allows his vehicle to be used by 'B' for a consideration, and the vehicle is placed at the control, custody and possession of 'B', it may be a case of transfer of the right to use the vehicle for any purpose. Where, however, the control, custody, and possession over the vehicle remains with 'A', notwithstanding the fact that certain amounts were received as hire charges, no transfer of the right to use is involved." 8. In Rashtriya Ispat Nigam Ltd. v. C....
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.... after scrutiny and close examination of the clauses contained in the agreement and looking to the agreement as a whole, in order to determine the nature of the transaction, concluded that the transactions between the respondent and contractors did not involve transfer of right to use the machinery in favour of the contractors and in the absence of satisfying the essential requirement of section 5-E of the Act, i.e., transfer of right to use machinery, the hire charges collected by the respondent from the contractors were not exigible to sales tax. On a careful reading and analysis of the various clauses contained in the agreement and, in particular, looking to clauses 1, 5, 7, 13 and 14, it becomes clear that the transaction did not involve transfer of right to use the machinery in favour of contractors. The High Court was right in arriving at such a conclusion. In the impugned order, it is stated and rightly so in our opinion, that the effective control of the machinery even while the machinery was in use of the contractor was that of the respondent-company, the contractor was not free to make use of the machinery for the works other than the project work of the respondent or mov....
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....FCO, Phulpur, Allahabad is as follows: "You will place at the disposal of IFFCO one 50/52 seater bus model 1987. This will be used for transportation of man and material of IFFCO and will be run as per directives of representatives of IFFCO. Generally the vehicle will run between Phulpur and Allahabad but some times it may be required to go outside Allahabad also. In such cases, you will arrange route permit for that destination. IFFCO will reimburse the charge for route permit when presented with monthly bill. You will ensure availability of driver, in good condition spare tyres, tools and other necessary items and ensure that the vehicle is available for use every time. The vehicle can be pared with prior approval for periodical check up, servicing and maintenance, etc., for a maximum of one day in a month subject to the substitute vehicle of similar standard/capacity being made available by you during this period. In case you fail to provide substitute vehicle, IFFCO will impose penalty at Rs. 500/250 per day on you for the absent period. In case it is found that engaged vehicle is used outside, the penalty may extend up to Rs. 1000 for bus and Rs. 500 for standard/car/jee....
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....ually agreed upon between the parties referred above and fixed from time to time. That the buses must be duly insured under the Motor Vehicles Act to cover the passengers travelling. That in consideration of the above services to be rendered by the transporter, M/s. Bharat Pumps and Compressors Ltd., shall pay a sum of Rs. 34,768 (rupees thirty four thousand seven hundred and sixty eight) only per month, as under, payable monthly after rendering actual services. (i) UGV 153 Rs. 12,940 per month (ii) UGH 565, Rs. 12,940 per month (iii) UGV 181, Rs. 8,888 per month. In case of any rise in the rates of fuel by any Government notification, below 20 n.p. will not be entertained and above 20 n.p. the extra cost will be paid to the contractor based on actual consumption of fuel per month. That in case for any reason, whatsoever, the transporter fails to provide the said buses and/or is unable to transport the employees of Bharat Pumps and Compressors Ltd., on any day/trip, as the case may be, in addition to proportions to recovery of hire charges, he shall have to pay by way of liquidated damage a sum equal to double the hire charges for that day/trip. That the responsibility of k....