TaxTMI 
TaxTMI 
2021 (8) TMI 1444
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....licensing agreement dated 19.05.2009 with M/s. Fresenius Kabi Oncology Limited (FKOL). 3. During the relevant period, the appellant had received Rs.3,13,00,000/- from FKOL towards license fee under the abovementioned agreement. On the said payments received by the appellant from FKOL, (being towards deemed sale), the appellant had already paid sales tax (VAT), as applicable under the Uttar Pradesh Value Added Tax Act and assessed accordingly. 4. The appellant's records were audited by the audit party of the Central Excise Commissionerate, Ghaziabad on 01.11.2010 and 18.11.2010, wherein during the course of audit, the department observed vide DAR No177/2010-11 dated 15.02.2011, that the appellant had received payments against the service - 'supply of tangible goods' under the agreement entered into with FKOL. 5. Subsequently, correspondence took place between the appellant and the Department by which information regarding the transaction was sought by the Department and provided by the Appellant. 6. Thereafter, the Department issued a show cause notice bearing no.25/JC/ST/GZB/102/2011-12 dated 28.03.2012, proposing demand of Rs.29,22,847/- and the appellant contested and....
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....rol is a question of facts and is to be decided based on the terms of the contract and other material facts. This could be ascertainable from the fact whether or not VAT is payable or paid. (emp. Supplied) 10.3 It is further urged that the Appellant discharged VAT on the transaction and the VAT authorities already concluded the assessment proceedings in respect of the same transaction, considering the transaction as the transfer of right to use goods. Therefore, in terms of the above referred Circular, the same transaction is not taxable under the Service tax. Further reliance is placed on the decision of this Tribunal in the matter of M/s. Rockwell Automation India (P) Ltd. vs. CCE, Ghaziabad passed vide Final Order No.70660-70662/2019 dated 25.03.2019 in which held as follows: "6. Having considered the submissions from both the sides and on perusal of record we note that it was submitted before the original authority that the said consideration on which Service Tax was demanded was subjected to sales tax and original authority has not relied upon any evidence to establish that the said contention was unfounded. Further we have also perused the invoices which ....
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....nt nor they were free to allow/ assign sub-license these assets for use by others. M/s. FKOL was also not free to remove these assets from the premise of the Appellant. The clause 2.7 of the agreement said that even during the term of agreement the appellant can sell its right or interest in the said assets. This agreement only allows FKOL to use the laboratory infrastructure developed by the appellant over a period of time, by importing and installing Plant & Machinery and Laboratory equipment's for a specific purpose of oncological research without transferring possession and control. Thus, while FKOI had access to infrastructure in question, the appellant did not lose control over the said infrastructure, which is evident from the close reading of the terms of the contract signed by FKOL and the appellant. Thus I find it is not a case of mere naming of the agreement as 'Assets licensing Agreement' as contended by the appellant but the document is intentionally named license agreement as required by law. 5.11 The appellant's contention of payment of VAT/sales tax considering the transaction as deemed sale is also not correct in view of the Constitution Bench ....
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....ransferee may not be allowed to assign or sublicense the goods to others. 10.11 Further, the reliance placed by the Commissioner(Appeals) on the decision in the matter of Indus Tower Ltd. [2012 (285) E.L.T. 3 (kar.)] was wrong, because in that case the facts were different: it was noted as follows: "What is permitted under the contract is, a permission in the nature of a licence to have access to the passive infrastructure and permission to keep the equipment's of the mobile operator in the pre-fabricated shelter with permission to have ingress and egress only to the authorised representatives of the mobile operator". 10.12 Whereas in the present case, the customer was having right to use the goods for the purpose of doing research as contemplated under the Agreement. 10.13 It is also submitted that since the transaction was only a deemed sale, therefore, the sales tax was paid as and when consideration for such a transaction of right to use was received. In such cases, sales tax is not paid at the time of agreement to transfer the right to use goods. 10.14 The finding regarding discrepancy in payment received and payment of VAT under paragraph 5.8 is factually....