TaxTMI 
TaxTMI 
2013 (4) TMI 1022
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.... against order of assessment da ted 12.12.2011 creating a demand of Rs. 1,03,419/- for the year 2008-09. According to the said order, plea of the assessee that equipments are provided for specific sites and cannot be used by the customer at any other site, possession and control is of the assessee, operation of the equipment is by the assessee's operator, repair and maintenance is by the assessee and insurance is the responsibility of the assessee did not distract from the fact that the transaction was a lease transaction covered by the definition of lease under the Act. Demand has accordingly been raised for the amount of tax with interest. 3. In WP(C) Nos. 1395/2012 and 1396/2012 also, challenge is to the order of assessment dated 12.12.2011 for the years 2009-10 and 2010-11 which is identical in terms to the order impugned in WP(C) No. 1394/2012. Contentions raised in these petitions are also identical. WP(C) No. 4396/2010 seeks quashing of order dated 22.6.2010 initiating suo motu revisional proceedings against appellate order in favour of the petitioner vacating the order of assessment dated 9.3.2009 for the period from April, 2009 to June, 2009 and quashing the dema....
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.... as mentioned at serial number 9 of Schedule I of this Agreement, shall be paid by the Customer to the Owner in the form of Post dated cheques (PDC). The Owner shall present the PDC on due dates without any notice to the Customer. The Advance amount shall be interest free and be adjusted/ appropriated against the final invoice and/or any other amount due from the Customer. 4.3 The Customer shall not absolve the liability to pay the said sums hereunder until all the cheques are duly realized. The cheques/ PDC/ Draft shall be crossed A/C Payee favouring Quippo Construction Equipment Limited, payable at New Delhi or at any such other place as may be advised by the Owner from time to time. 6. Equipment Availability and Usage: 6.1 The Customer shall pay Rentals for the availability of each Equipment for 9/54/112.5/225 hours per day/ week/ fortnight/ month respectively on single shift basis. 6.2 Equipment availability period implies, operation of the Equipment on the bas is of 9/54/112.5/225 hours per day/ week/ fortnight/ month respectively, subject to the conditions mentioned under this Agreement. 6.3 Overtime beyond stipulated hours shall b....
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....Customer shall be liable to pay additional rentals for the shortfall of in notice period. The Customer shall bear, all mobilization and demobilization expenses of the Equipment. Extension: In the event the Customer desires to extend the period beyond the agreed tenure, the Customer shall make a written request in this regard to the Owner at least fifteen (15) days prior to the expiry of the tenure of the agreement. The request of the Customer for extension of tenure of the agreement shall be considered and would be informed in writing within seven (7) days from the date of receipt of such request. 14. Right of Inspection : The Owner and/or its authorized representatives and/or Company's, Banker's and Financial Institutions shall, at all times at the cost of the customer, have the right, without notice, to examine the state and condition of the Equipment. Joint inspection shall be carried out in case of renting without operator, both at the time of providing and taking back of the Equipment.'. 8. Main contention raised on behalf of the assessee is that the transaction in question did not involve 'transfer of right to use'. According to learned counsel for the assessee, t....
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....d are specified. (b) The same stand delivered by the assessee to the customer for consideration. (c) The use is permitted continuously without any interference. (d) Charges are paid in advance for the whole duration. (e) No other person can use the said goods during this period. (f) Exclusive dominion and control is of the customer. (g) The assessee itself cannot use the goods in any manner during the period in question. Cumulative effect of above factors clearly show that the right to use stands transferred in favour of the customer for consideration. There is no service component beyond providing maintenance which is not inconsistent with transfer of right to use. Who is responsible for the maintenance does not determine who has right to use. Supply of equipment being site specific does not mean that right to use has not been transferred. Claim of the assessee that possession and control continues with it is belied by terms of the agreement. The assessee is charging for entire period of availability on monthly basis for exclusive use by the customer, to the exclusion of the whole world. Even assessee can use the equip....
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....cide as to who has domini on over the crane inasmuch as the crane can be recalled for duty by the ONGC at any time. Under the contract the crane is to be operated for 26 days in a month and the remaining four days are to be treated as maintenance off days. Though the crane is not operational on the maintenance off days, yet, 50% of the operational charges is paid by the ONGC for the maintenance off days and the terms of the contract make it clear that even on the off days the crane can be called for operation by the ONGC at its sole discretion. 20. The above features of the contract, in our considered view, makes it abundantly clear that it is the ONGC and not the contractor who has exclusive control and dominion over the crane during the subsistence of the contract, though, during the aforesaid period, at times, physical possession of the crane may come back to the contractor. Such temporary physical possession of the contractor, according to us, would hardly be relevant as under the contract the ONGC is vested with the authority to requisition the crane for operational purposes at any time. Besides, such temporary possession of the crane by the contractor does not mitiga....
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....Whether there is a transfer of right to use or not is a question of fact which has to be determined in each case having regard to the terms of the contract under which there is said to be a transfer of right to use. 14. In WP(C) No. 578/2009 (Brahmaputra Valley Construction & Supplies -vs- Oil & Natural Gas Corporation Ltd. & Ors.) and other similar matters, decided on 24.7.2012, this Court dealt with identical issue. It was held : The agreement is for hiring of the cranes. The heading and the recital clearly show that nature of transaction is for the hiring. The hire charges are per day for all days except the off days, though the bill is to be raised monthly. The provisions for maintenance, providing staff for maintenance and operation and ta king responsibility for claim of third parties do not affect the nature of the transaction. A perusal of the above terms shows that (a) the contract is for hiring of the cranes for carrying out the operations of the ONGC; (b) the scope of work is mentioned to specify the operation in connection with which the cranes are hired; (c) the work is not to be executed by the contractor but by the ONGC itself; (d) the contractor is to pr....
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....bsence of discussion of ratio of Division Bench judgment of this Court in Dipak Nath, it cannot also be held that there is a conflict in two Division Bench judgments of this Court so as to refer the matter to a larger Bench. 15. In Bharat Sanchar Nigam Ltd. (supra), it was observed: 75. In our opinion, the essence of the right under Article 366(29-A)(d) is that it relates to user of goods. It may be that the actual delivery of the goods is not necessary for effecting the transfer of the right to use the goods but the goods must be available at the time of transfer, must be deliverable and deliver ed at some stage. It is assumed, at the time of execution of any agreement to transfer the right to use, that the goods are available and deliverable. If the goods, or what is claimed to be goods by the respondents, are not deliverable at all by the service providers to the subscribers, the question of the right to use those goods, would not arise. 76. In State of A.P. v. Rashtriya Ispat Nigam Ltd., (2002) 3 SCC 314 it was claimed by the Sales Tax Authorities that the transaction by which the owner of certain machinery had made them available to the contractors ....