TaxTMI 
TaxTMI 
TaxTMI 
2023 (1) TMI 1458
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....compensated by Lindstrom. (iv) The workwear shall be collected by the customer once a week for being sent to Lindstrom for servicing. (v) If the workwear cannot be leased because of wear and tear, it will be returned to Lindstrom but the customer shall pay the price as per the price list (depreciated price). If the workwear is to be replaced by the customer, the same is to be redeemed at agreed upon price. (vi) Retail Price will increase every year by 8%. (vii) VAT is being charged on the rental charges (see invoice reproduced at Para 4.3 Page 4 of the SCN). (viii) There are separate provisions for pricing of replacement and valuation of redemption price. On the basis of the above activities under the agreement and conditions therein, it appears that the appellant is engaged in supply of Work-wear on rent/ lease basis as per the requirement of each customer. The activity rendered by the appellant includes renting/ leasing of Work-wear, washing, maintenance, repairing, alteration, designing of Work-wear, providing lockers and transportation of Work-wear. The revenue after discussing the definition of 'Supply of Tangible Goods Service' as incorporated in Section 65(105)(zzzzg) ....
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....ra Prakash, learned (Assistant Commissioner) Authorized Representative appearing for the Revenue reiterates the findings of the impugned order in appeal No. ST/10718/2021 and reiterates the grounds of appeal in respect of Appeal No. ST/11134/2019. He further submits that in the appellants case against the Chennai Tribunal order, the Revenue has filed appeal before the Hon'ble Supreme Court which is pending. On the query from the bench, he fairly concedes that as of now there is no stay against the Chennai Tribunal's order from the Hon'ble Supreme Court. 4. We have carefully considered the submissions made by both the sides and perused the records. We find that Tribunal's two benches one from Chandigarh and one form Chennai all the three orders decided the similar matter in the appellant's own case in their favour. The said Tribunal's Order are reproduced below: CESTAT Chandigarh Order No. 60716 of 2019 dated 02.08.2019 "18. We have heard Ld. Advocate for the appellant and Ld. DR for Revenue and also perused the appeal records. 19. The appellant is engaged in providing work-wear solution to the various industrial customers in terms of various agreements where there is transfer o....
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....rocess valid at any given time. ................... ................... 22. Ld. Adjudicating Authority has treated this to be a pure service relying on the conditions of the agreement and also various other information available on the website of the appellant. 23. It was held that the work-wear always in the control of appellant and hence there is no transfer of effective control by the appellant hence out of the purview of the deemed sale as per the Article 366 (29A)(d) of the Constitution of India. It is necessary to have transfer of right to use involving both transfer of possession and also effective control of the goods by the user of the goods. The transaction for allowing another person to use the goods without giving legal right of possession cannot be treated as deemed sale of the goods, and thus has to be treated as service only. It is also the contention of the Department that after introduction of the negative list based tax regime, the activity of the supply of goods without transfer of right liable to tax by virtue of Section 66E (f) of Finance Act. On the other hand, we find that Ld. Advocate as relied upon the Hon‟ble Supreme Court‟s decision i....
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....The Petitioners' counsel contends that five eventualities to infer the transfer of the right to use goods are not completely present in the transaction between the Petitioners and Grasim. He would urge that the Tribunal was wrong in relying on Clauses (A), (B) and (D) of the contract in concluding that the Petitioners had transferred the right to use Transit Mixers to Grasim. According to him, these clauses would not lead to any such conclusion and that there was no intention to create exclusive right to use the vehicles by Grasim. The clause for providing dedicated fleet of vehicles with Grasim's logo "Birla Concrete" being painted on them is no indication that the intention was to transfer the right to use Transit Mixers. The RMC is a product with short shelf life and its marketability depends on the quality. So as to assure the product quality to end-user, it was agreed to paint the brand name on the vehicles. The same, however, does not lead to an inference that there is consensus ad idem; and that the Petitioners should keep ready the dedicated fleet of eight vehicles to be used by Grasim. In the absence of transfer of possession and effective control, Section 5-E of t....
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....ticular user, it is up to the user how to put the same to use as per his choice. There remains no "control‟ of the noticee over the user so as to restrict or compel a user to use the articles of clothing in a particular manner. This proves that the "possession‟ and "custody‟ of goods practically remains with the user." 26. Accordingly, we find that in the instant case, in terms of agreement work-wear rented out always remains within the exclusive possession of their clients and nobody else can use the those workwear at the same time and hence effective control to lie with the user/ clients. The appellant, therefore, does not have control over the use of the work-wear. Thus the activity is not in the nature of "service‟ under the Finance Act in both during the period prior to negative list regime and thereafter as held in the impugned order. The order under challenge is, therefore, not sustainable. 27. In view of above the impugned order is set aside and appeal is allowed." Subsequently in appellant's appeal before the Chennai Cestat was decided vide Final Order No. 40818 /2020 dated 29.10.2020, following the decision of CESTAT Chandigarh Bench is as ....