Crane Hiring Not Sale, No MVAT If Ownership And Control Remain With Owner: Bombay High Court

The Bombay High Court has ruled that hiring out cranes does not amount to a sale for levy of Maharashtra Value Added Tax (MVAT) when ownership and effective control of the cranes remain with the owner.A Division Bench of Justice Suman Shyam and Justice Advait M. Sethna allowed an appeal filed by Sharma Heavy Lifter. It quashed the Maharashtra Sales Tax Tribunal's order holding the crane-hiring transactions liable to VAT and imposing interest and penalty.“None of the attributes, characteristics...

Pidilite's SBR Latex Products Covered By 'Rubber' Entry, Taxable At 5%: Uttarakhand High Court

Today, the Uttarakhand High Court held that Pidilite Industries' Dr. Fixit Pidicrete URP and Dr. Fixit Super Latex, being Styrene Butadiene Rubber (SBR) Latex, fall within the term “rubber” under the Uttarakhand Value Added Tax Act and are taxable at 5%, rather than the 13.5% rate applicable to unclassified goods. A Division Bench of Chief Justice Manoj Kumar Gupta and Justice Subhash Upadhyay set aside a Commercial Tax Tribunal's judgment and restored the First Appellate Authority's order...

Revenue Cannot Deny Composition Rate After Accepting Dealer's Turnover Below ₹50 Lakh: Madras High Court

The Madras High Court has ruled that a dealer eligible for the tax composition scheme cannot be denied its concessional rate when the assessing authority itself determines that the dealer's taxable turnover is below the ₹50 lakh limit.The bench held that the authority cannot rely on an earlier estimate showing turnover above the limit after finally fixing the taxable turnover below it.“The Assessing Officer could not maintain two contradictory positions in the same order, i.e., on one hand,...

Hiring Buses To APSRTC Without Control Transfer Not Taxable As Deemed Sale: Andhra Pradesh High Court

The Andhra Pradesh High Court on 3 September held that hiring buses to the Andhra Pradesh State Road Transport Corporation (APSRTC) does not amount to a transfer of the right to use goods where substantial control and physical possession remain with the bus owners. A Division Bench of Justices Ninala Jayasurya and T.C.D. Sekhar quashed the assessment orders against private bus operators, holding that the transactions were not taxable as deemed sales under Section 4(8) of the Andhra Pradesh...

Furnace Oil And Light Diesel Oil Are Distinct, Cannot Be Taxed Alike: Madhya Pradesh High Court

The Madhya Pradesh High Court on 8 September held that Furnace Oil (FO) and Light Diesel Oil (LDO) are distinct commodities and cannot be taxed at the same rate merely because both are used as fuel. A Division Bench of Acting Chief Justice Vivek Rusia and Justice Pradeep Mittal allowed petitions filed by Indian Oil Corporation Limited (IOCL), setting aside orders that had treated FO as LDO for taxation purposes. The judges observed: “In view of the above, uncontroverted material tax liability...

Bombay High Court Allows Microsoft's Plea Against ₹1.40 Crore VAT, CST Interest Demand

The Bombay High Court has ruled in favour of Microsoft Corporation (India) Pvt. Ltd. in a dispute over interest on VAT and CST payments. The court held that the company could not be treated as having delayed payment when it had paid tax within the time allowed for its six-monthly returns.“The present is a case where the tax has been paid in terms of the timeline prescribed by the Act and the rules as indicated earlier,” a Division Bench of Justice M.S. Karnik and Justice Sandesh D. Patil ruled....

Punjab & Haryana High Court Disposes Sony India Plea Against 2006 VAT Entry Substitution

The Punjab & Haryana High Court has disposed of a plea filed by Sony India Private Limited concerning its claim for a concessional VAT rate of 4% on Digital Still Image Cameras, holding that the company was not prejudiced by the notification it had challenged.A bench of Acting Chief Justice Ashwani Kumar Mishra and Justice Yashvir Singh Rathor observed that the expression “IT Products”, which formed the basis of Sony's claim for the concessional rate, continued to remain part of Entry No. 60...

Madras High Court Says Appeal Against Fresh Assessment Order Statutorily Barred, Remands BHEL Matter

The Madras High Court on 10 August remanded Bharat Heavy Electricals Limited's (BHEL) tax matter to the Assessing Officer for fresh assessment. A Division Bench comprising Justices Dr. G. Jayachandran and N. Mala passed the order while disposing of a Tax Case Revision filed by BHEL against the order of the Sales Tax Appellate Tribunal. The judges held: “The assessment orders in the instant case and the orders of the Appellate Authority are verbose and detailed. However, the fact remains that...

Telangana High Court Quashes ₹52.39 Crore VAT Demand On TCS's Customised Software Services

The Telangana High Court has set aside a ₹52.39 crore Value Added Tax (VAT) demand imposed on Tata Consultancy Services (TCS).It held that transactions involving the development of custom-made or customised software did not constitute a sale where TCS did not acquire ownership or title over the software. The Court found that there was no transfer of property in goods.A Division Bench comprising Justice P. Sam Koshy and Justice Narsing Rao Nandikonda passed the common order. It allowed the lead...

Turnover Cannot Be Enhanced Without Quantifying Suppression Found During Survey: Allahabad High Court

The Allahabad High Court on 25 August held that turnover cannot be enhanced merely on the ground of alleged suppression when the actual figure of suppression has not been identified, observing that even where the books of account are rejected, the enhancement must correspond to the suppression found during the survey. Justice Piyush Agrawal allowed the revision filed by B.T.C. Industries Pvt. Ltd. and set aside the order of the Commercial Tax Tribunal, Bareilly Division, holding that the...

VAT Penalty Refund Cannot Be Denied Over Filing Before Re-Designated Authority: Patna High Court

The Patna High Court on 21 August held that the State Tax Department cannot deny a dealer's refund of a penalty under the Bihar Value Added Tax Act, 2005 merely because the refund application was filed before the Joint Commissioner of State Tax instead of the re-designated Additional Commissioner of State Tax. A Division Bench of Justices Anil Kumar Sinha and Vikash Kumar observed that such a technical objection cannot defeat a legitimate refund claim, and allowed a writ petition filed by S and...

Rajasthan High Court Upholds Excise Duty On Scrap Of CENVAT-Credited Capital Goods

The Rajasthan High Court on 3 August held that excise duty is payable when capital goods on which CENVAT credit was availed are subsequently cleared as waste or scrap, even if the scrap does not fall under a specific tariff entry. A Division Bench of Justices Arun Monga and Ashutosh Kumar dismissed an appeal filed by Shree Cement Ltd. against the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) order upholding the excise duty demand on the clearance of such scrap. The judges held: ...