TaxTMI 
TaxTMI 
2015 (5) TMI 32
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....iable to tax? 2. The facts, in brief, giving rise to the present Reference are as under: The respondent is registered under the Licence Act and is engaged in carrying on the business of hiring of cranes. The respondent had filed an Application under section 8 of the Maharashtra Sales Tax for determination of question as to whether he would fall under the term of "dealer" under the Maharashtra Sales Tax on the Transfer of Right to use any goods for any purpose Act, 1985 (hereinafter referred to as the 'Lease Act') along with Section 61 of the Bombay Sales Tax Act, 1959. The Additional Commissioner while dealing with the said Application held that the respondents would fall within the definition of a 'dealer' and as such, the transaction entered into by him with M/s. Offshore Hook-Up & Construction Services (I) Pvt. Ltd. would be governed by the provisions of the said Act and as such taxable. Being aggrieved thereby, an Appeal came to be preferred. The learned Tribunal reversed the finding of the learned Additional Commissioner and held that the transaction entered into between the respondent and M/s. Offshore Hook-Up & Construction Services (I) Pvt. Ltd. would not a....
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....dent is not a "dealer" as per the provisions of Section 2(4) of the Lease Act, the transaction as referred to in question no. 2 will have to be held as not taxable. However, if we hold that respondent is a dealer as defined under section 2(4) of the Lease Act, the transaction will have to be held taxable. We, therefore, proceed to decide question no. 1. 6. For appreciating the rival controversy, it will be necessary to refer to the definition of term 'dealer' as per Section 2(4) of the Lease Act. "dealer" means any person who whether for commission, remuneration or otherwise transfer the right to use any goods for any purpose (whether or not for a specified period) cash, deferred payment or other valuable consideration and includes the State Government or the Central Government which so transfers the right to use goods and also society, club or Association of persons which so transfers the right to use such goods to its members." 7. The term 'Sale' is defined under section 2(10) of the Lease Act as under: "Sale" means the transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash deferred payment or any other valuable....
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.... be calculated on pro-rata. (viii)You will give us 2 days notice to mobilize our crane from Bombay. Payment 1. 1,00,000/- will be paid as advance with work order. 2. Balance amount will be paid on the date of release of crane (on 21st day from the date of reaching site) Awaiting a favourable reply soon. Thanking you, Yours faithfully, For General Cranes. And Acceptance letter dated 22.06.1990 by M/s. Offshore Hook-Up & Construction Services (India) Pvt. Ltd, "Ref: OHCS/GNB/30346/90/695 dated June 22, 1990 M/s. General Cranes, Near Pitroda Automobile works, T.J. Road, Sewree, Bombay-400 015. ATTN. MR. D.J. PITRADO Gentleman, Sub: Hire of 75 Tonnes Capacity Mobile Crane with 140 ft. Boom With reference to your quotation dated 21.06.1990 OHCS is pleased to hire your crane on the following terms and conditions: 1. Shift timing will be from 7.00 am to 7.00 p.m. 2. Diesel will be supplied by you. 3. Overtime working of crane after 7.00 p.m. will be charges on pro-rata basis. 4. Breakdown of equipment will be deducted on prorata basis. 5....
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....the meaning of 'Transfer of right to use any goods'. Upholding the reasoning given by the High Court, the Apex Court observed thus: "The High Court 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....
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....a) There must be goods available for delivery; (b) There must be a consensus ad idem as to the identity of the goods; (c) The transferee should have a legal right to use the goodsconsequently all legal consequences of such use including any permissions or licences required therefor should be available to the transferee; (d) For the period during which the transferee has such legal right, it has to be the exclusion to the transferor - this is the necessary concomitant of the plain language of the statute - viz., a "transfer of the right to use" and not merely a licence to use the goods; (e) Having transferred the right to use the goods during the period for which it is to be transferred, the owner cannot again transfer the same rights to others." 12. In the judgment, it has been held that to constitute a transaction for the transfer of the right to use the goods, it is necessary that there must be a consensus ad idem as to the identity of the goods. It is further necessary that the transferee should have a legal right to use the goods, all legal consequences of such use including any permissions or licences required therefor should be available to the transferee and for the per....
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.... goods; (c) the transferee should have a legal right to use the goods-- consequently all legal consequences of such use including any permissions or licences required therefore should be available to the transferee; (d) for the period during which the transferee has such legal right, it has to be the exclusion to the transferor--this is the necessary concomitant of the plain language of the statute viz. a "transfer of the right to use" and not merely a licence to use the goods; (e) having transferred the right to use the goods during the period for which it is to be transferred, the owner cannot again transfer the same rights to others." Sub-paras (b) and (c) of para 97 are important with reference to the facts of the case to determine as to whether or not there is a sale by virtue of transfer of right to use goods as envisaged in Article 366(29-A)(d). The S.T. Appeal No. 10/2009 Page 15 admitted position which emerges is that the transferee, namely NDPL, has not been made available the legal consequence of the legal right to use the goods viz. the permissions and licences with respect to the goods. In the present case, the permissions and licences with respect to the Cabs are ....
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....ards hiring of trucks/tankers. Notice was issued to the petitioner directing to deduct tax under section 27(a) of the Assam General Sales Tax Act on payment of hire charges to the contractors who were owners of the vehicles hired by the petitioner-company. The petitioner was also issued subsequent communication and also show cause notice. The petitioner approached the Assam High Court challenging the jurisdiction to issue notice. The petition was resisted on the ground that act of hiring vehicles by the petitioner-company amounted to transfer of the right to constitute the lease and, therefore, not eligible to tax under the Act. It was contended that the transfer of right to use the vehicle constitute "sale" within the definition of the ambit of "sale" as embodied in section 2(33) of the Assam Act. After considering the various judgments of the Apex Court, the Division Bench observed that: "It is, therefore, clear that in order to constitute a transfer of right to use goods, there must be parting with the possession of the goods for the limited period of its use in favour of the lessee by the lessor. The effective control of the goods must not remain with the owner, but must stand....