TaxTMI 
TaxTMI 
2022 (5) TMI 77
X X X X Extracts X X X X
X X X X Extracts X X X X
....poration Ltd., are a Government of Karnataka Undertaking and are wholly owned and controlled by the Government of Karnataka; the appellants are designated as a company for sole distribution of liquor in the State of Karnataka. The appellant purchases liquor from distilleries from in and outside State of Karnataka and distribute the same in the State. The appellants enter into agreement with distilleries and manufacturers and to sell the same to licensed wholesale dealers in accordance with Karnataka Excise Act and Rules framed thereunder. The appellants sell liquor to various license holders keeping a profit margin varying depending on the type of liquor as per the rates fixed by the Government. The appellants would also store liquor for a ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....in number of cases i.e., Rajasthan State Beverages Corporation Ltd. vs. CCE: 2018 (11) GSTL 157 (Raj.); Chhattisgarh State Beverages Corporation Ltd. vs. CCE: 2015 (37) STR 972 (Chhattisgarh); Kerala State Beverages (M &M) Corporation vs. CCE: 2014 (33) STR 484 (Kerala); K.S.B. (MGF. MKT.) Corporation vs CCE: 2013 (31) STR 565 (Tri.-Bang.) and Karnataka State Beverages Corporation Ltd. vs. CST: 2007 (8) STR 481 (Tri.-Bang.) (Revenue appeal dismissed by Hon'ble Karnataka High Court as reported in 2011 (24) STR 405 (Kar.), which was affirmed by the Supreme Court as reported in2015 (40) STR 209 (SC). He further submits that decision of Rajasthan State Beverages Corporation Ltd (supra) has been upheld by Supreme Court by dismissing the Special ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... collected for storage of the goods because ones the appellant-corporation purchases the goods, the ownership no longer vests with the manufacturer. So, even if it is considered that the appellants are rendering the services of storage and warehousing, such service is only in respect of the goods owned by them for which, no Service Tax can be levied. We also find that from the Bill of Karnataka State Warehousing Corporation raised on the appellant that they charge Service Tax at the rate of 10% and Education Cess 2% in respect of the charges collected from them for hiring the storage bases to them. In our view, the appellants are only recipients of the services of storage and warehousing and it cannot be said that they are providing the ser....
X X X X Extracts X X X X
X X X X Extracts X X X X
....and the Tribunal confirmed such decision. The High Court held as follows: "Since the sale took place on delivery of goods under terms of contract, the transaction was rightly assessed in the year in which delivery was given". The above judgment supports our finding that the transfer of supplies to KSBC in terms of the rate contracts is pursuant to completed sale. The provisions of "The Sale of Goods Act" do not warrant a different inference in the facts of the case for the reason that payment of consideration is deferred as per contract." In view of the above, we find that the appellants have discharged their statutory functions as the mandate given by the Karnataka State Excise Act and Rules thereunder and have not rendered any services....