Hiring Of Motor Vehicle Or Cranes Is Not 'Sale Of Goods' If Control Over Equipment Is Retained By Contractor, VAT Can't Be Levied: Supreme Court

The Supreme Court has held that the hiring of motor vehicles/cranes from a contractor is a service and would not attract Sales Tax or Value Added Tax (VAT) assuming the transaction to be sale of goods. The Court clarified that transfer of right to use the goods not only includes possession but also control over goods by the user. If the control over the goods remains with the contractor during the hire period, then it cannot be termed as sale of goods and only service tax can be levied. The...

UP VAT Act | Definition Of “Goods” Under Sec. 2(m) And Sec. 13(1)(f) Includes Taxable As Well As Exempted Goods: Supreme Court

The Supreme Court has held that the definition of “Goods” under Section 2(m) of Uttar Pradesh Value Added Tax Act, 2008 (“UP VAT Act”) includes both taxable as well as exempted goods. Similarly, the word “goods” under Section 13(1)(f) of the UP VAT Act cannot be said to be qualified by the word “taxable”.The Bench comprising the Chief Justice Dr. Dhananjaya Y. Chandrachud, Justice J.B. Pardiwala and Justice Manoj Misra, has held that the legislative intent behind the 2010 amendment to the UP VAT...

UP VAT Act | Assessee Entitled To Claim Full Input Tax Credit On Exempted Goods Produced As By-Products Or Waste Products During Manufacturing Of Taxable Goods : Supreme Court

The Supreme Court while relying on Explanation (iii) to Section 13 of Uttar Pradesh Value Added Tax Act, 2008 (“UP VAT Act”), has held that if during the manufacture of any taxable good any tax exempted goods are produced as by-product/waste product, then it shall be deemed that the goods purchased from within the State for such manufacturing have been used in manufacture of taxable goods alone. Thus, the Assessee would be entitled to claim full benefit of Input Tax Credit (“ITC”) in respect of...

State Amendments Made To VAT Acts After GST Came Into Effect Are Invalid : Supreme Court

A Division Bench of the Supreme Court, while deciding the appeals arising from judgments of Telangana, Gujarat and Bombay High Court with respect to the validity of VAT Amendment Act in their respective states, made several significant findings regarding Section 19 of the Constitution (101st Amendment) Act (Amendment), 2016, which allowed the introduction of the Goods and Services Tax.Inter-alia, the issue was about the legislative competence of the State enactments after 01.07.2017 i.e. beyond...

Mortein Spray, Harpic & Lizol Cleaner- Not Classifiable as ‘Insecticide’ Under KVAT; Dettol A 'Medicament': Supreme Court

The Supreme Court bench comprising Justices M. R. Shah and Krishna Murari has ruled that Mosquito Mats, Coils and Vaporizers, Mortein Insect Killers, Harpic Toilet Cleaner and Lizol Floor Cleaners, are not be classifiable under Entry 44(5) of the 3rd Schedule to the Kerala VAT Act (KVAT), 2003 as ‘insecticides’.While observing that Entry 44(5) of the 3rd Schedule to the Act is a general entry, the bench observed that the said products would fall under Sl.No.66 and 27(4) of...

KVAT Act | Dealer Claiming Input Tax Credit Must Prove Transaction Beyond Reasonable Doubt : Supreme Court

The Supreme Court has held that under Section 70 of the Karnataka Value Added Tax Act, 2003, a dealer claiming Input Tax Credit on purchase ought to prove and establish actual physical movement of goods and genuineness of transaction. It noted that in order to establish the same, the dealer should furnish the name and address of the selling dealer, details of the vehicle which has delivered the goods, payment of freight charges, acknowledgement of taking delivery of goods, tax invoices and...