M/s.G.S.Lamba & Sons v. State of Andhra Pradesh

COMMON ORDER: (Per Hon’ble Sri Justice V.V.S.Rao)

These ten tax revision cases under Section 22(1) of the Andhra Pradesh General Sales Tax Act, 1956 (the Act) are filed by assessees against a common order dated 30.11.2009 of the Sales Tax Appellate Tribunal (the Tribunal) in Tax Appeal Nos.467 of 2009 and batch. The details of various appeals are admitted and hence narration of minute particulars is not necessary. Suffice to mention that the assessing authority passed orders for the assessment years 2001-02 to 2004-05, in all these cases in December, 2005, August and November 2006. The petitioners’ appeals were allowed on 08.5.2007. About two years thereafter, the Additional Commissioner (Legal) passed orders on 29.11.2008 under Section 20(1) of the Act which were preceded by the show cause notices dated 02.9.2008. All the tax appeals filed by the petitioners, being Tax Appeal No.467 of 2009 and batch, were dismissed on 30.11.2009. Facts

The undisputed factual matrix is in a narrow compass. The petitioners – M/s.G.S. Lamba & Company, G.S.Lamba & Sons, and G.S.L. Coal Sales Pvt. Ltd., – are dealers on the rolls of the Commercial Tax Officer (CTO), Begumpet Circle. In pursuance of the inspection and investigation by the Vigilance and Enforcement Wing, the CTO assessed tax for 2001-02 and 2002-03 under Section 5-E of the Act in respect of the taxable event, namely, the petitioners hiring their fleet of Transit Mixers to M/s.Grasim Industries Ltd., Secunderabad, a unit of M/s.Birla Ready Mix Concrete (hereafter, Grasim). The Appellate Deputy Commissioner agreed with assessees and treated the hiring of Transit Mixers as contract of transport service, and not the transfer of the right to use the goods. The Additional Commissioner (Legal), in exercise of the revisional jurisdiction, levied sales tax under Section 5-E of the Act. The petitioners then went in further appeals before the learned Tribunal, which were dismissed.

The case of the petitioners is that Grasim manufactures Ready Mix Concrete (RMC), according to the specifications depending on the site requirements of a customer, at its batching plants in Miyapur and Nacharam in Hyderabad. RMC is a homogenized and a precise mixture. Its use reduces work at the site, minimises space requirements and allows smooth progress of the construction. It has a very short shelf life of 3 to 4 hours from the time of its manufacture at the batching plant, and has to be used within that period. Keeping all these in view the petitioners entered into agreements with Grasim. These contracts are for providing transportation service for shipping RMC by hiring specially designed Transit Mixers. Under the contracts, the Transit Mixers are never transferred and the effective control over running and using of these vehicles, as well as the disciplinary control over the drivers, always remained with the petitioners. They point out that it is their responsibility to obtain route permits, to take the risk or loss of transportation, to decide shifts for drivers and vehicles, to maintain and upkeep the vehicles in good condition. It is also their plea that damages to the goods, during the period of transportation, and the risk of loss of the vehicles have to be incurred by the petitioners, and that registration of the vehicles is never transferred to Grasim. They further contend that, if on reading the contract, two views are possible, revision by the Additional Commissioner, under Section 20(2) of the Act, would not lie. Submissions

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 the Act is inapplicable. Lastly it is urged that the Tribunal was in error in not recording findings on all the issues raised by the petitioners. The Counsel relied on various precedents to which a reference would be made at the appropriate place.

The Special Counsel for Commercial Taxes points out that the agreement between the petitioners and Grasim is a post created document and no importance can be attached to the same. Alternatively he submits that the Tribunal has correctly appreciated questions of fact in the light of the agreement between the parties which clinchingly reveals the presence of the essential requirements of Section 5-E of the Act and, therefore, no interference is called for in these revision petitions under Section 22(1) of the Act. Points for consideration

The two issues that spring up from the background facts and the rival submissions are: Whether the petitioners’ contract is for transfer of the right to use Transit Mixers to M/s.Grasim Industries Limited for transporting the RMC? And whether the State Sales Tax Appellate Tribunal has committed any error warranting interference under Section 22(1) of the Andhra Pradesh General Sales Tax Act, 1957? Revisional jurisdiction under APGST Act

We will first deal with second issue. The petitioners would contend that the exercise of jurisdiction under Section 20(2) of the Act is barred when two views are equally possible and one of which is accepted by the original authority. This argument is sought to be sustained relying on Malabar Industrial Co. Ltd., v Commissioner of Income Tax[1], CIT v Arvind Jewellers[2], Commissioner of Income Tax v Greenworld Corporation[3] and Commissioner of Income Tax v Associated Food Products and Popular Bread Factory[4]. These judicial decisions were rendered in the context of Section 263(1) of the Income Tax Act, 1961, not with reference to the language of Section 20(1) of the APGST Act. The scope of revisional jurisdiction under these provisions is also different. Therefore we are afraid the decisions under Section 263(1) of the Income Tax Act would not be applicable here. For comparison, we may quote Sections 20(1) & (2) of the APGST Act and Section 263(1) of the Income Tax Act in the following table. Section 20 of the APGST Act Taxes is prejudicial and other prescribed

Revision by Commissioner of Commercial authorities: (1) The Commissioner of Commercial Taxes may suo motu call for and examine the record of any order passed or proceeding recorded by any authority, officer or person subordinate to it, under the provisions of this Act, including sub-section (2) of this section and if such order or proceeding recorded interests of revenue, may make such enquiry, or cause such enquiry to be made and subject provisions of this Act, may initiate proceedings to revise, modify or set aside such order in reference thereto as it thinks fit. (2) Powers of the nature referred to in sub-section (1) may also be exercised by the Additional Commissioner, Joint Commissioner, Deputy Commissioner, Assistant Commissioner and the Commercial Tax Officer in the case of orders passed or proceedings recorded by authorities, officers or persons subordinate to them. orders Section 263 of the Income Tax Act Revision

prejudicial to revenue (1) The Commissioner may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the Assessing Officer is erroneous in so far as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order circumstances of the case justify, including an order enhancing or the assessment, or modifying canceling the assessment and directing a fresh assessment. thereon as (Sub-sections 2-A, 3, 5 and 6 are omitted.) (Explanation and sub-sections (2) and (3) are omitted.) (emphasis supplied)

The power under Section 263(1) of the Income Tax Act conferred on the Commissioner is exercisable only when an order passed by the assessing officer, “is erroneous insofar as it is prejudicial to the interest of the revenue”. I n Malabar Industrial Co., Ltd., the Supreme Court held that,

the Commissioner of Income Tax has to be satisfied of twin conditions, namely, (i) the order of the assessing officer sought to be revised is erroneous; and (ii) it is prejudicial to the interests of the revenue (and) if one of them is absent – if the order of the Income Tax Officer is erroneous but is not prejudicial to the revenue or if it is not erroneous but is prejudicial to the revenue – recourse cannot be had to Section 263(1) of the Act

. On the other hand, Section 20(1) of the Act confers suo motu power on the Commissioner of Commercial Taxes and other prescribed authorities to call for the record and modify or set aside the order of any assessing authority, “if such order or proceeding recorded is prejudicial to the interests of revenue”. Thus, it would be enough to have recourse to Section 20(1) of the Act if any assessment order or proceeding is prejudicial to the revenue. This construction under the APGST Act may have certain exceptions with which we are not concerned here. We are well supported by two decisions of this Court in B.S.Parikh & Co. v Commr. of C.T.[5] and M/s.GMM Co. Ltd v State of A.P.[6].

It is axiomatic that the machinery provisions of a taxing statute have to be interpreted in such a manner that they are workable (Commissioner of Income-tax, Central Calcutta v National Taj Traders[7] and J.K. Synthetics Limited v Commercial Taxes Officer[8]). It does not, however, mean that the interpreter can interpolate something not intended by the legislature, by supplying causus omissus (Illachi Devi v Jain Society, Protection of Orphans India[9] and Sankar Ram & Co., v Kasi Naicker[10]). If the plea of the petitioners is accepted, we have to read Section 20(1) of the APGST Act as empowering revision, only when an order of assessing officer/appellate authority is erroneous in so far as it is prejudicial to the interest of revenue. This is plainly not permissible.

The impugned order of the Tribunal is also attacked on the ground that the Tribunal erred in not recording a finding on the issue raised. This cannot be a ground for us to exercise revisional jurisdiction under Section 22(1) of the Act. As rightly pointed out by the Special Counsel for Commercial Taxes, the submissions were noted in the order. The learned Tribunal considered the core issue and, having found that the agreement is a contract for the transfer of the right to use Transit Mixers, dismissed the appeals. We fail to understand as to how the impugned order can be put to challenge only on the ground that a finding is not recorded on one of the issues raised by the assessee before the Tribunal. Transportation service or Transfer of the right to use Transit Mixers?

The petitioners allege that the contract with Grasim is for transportation service. They deny that it is for the transfer of the right to use the goods. Transit Mixers are indisputably goods as defined in Section 2(h) of the Act. Section 2(n) defines “sales” to mean transfer of the property in goods for cash in the course of trade or business and includes mortgage, hypothecation, pledge or charge on goods. This definition has eight Explanations. Fourth of them was inserted by Andhra Pradesh Act No.18 of 1985 with effect from 02.02.1983. It is to the effect that “a transfer of the right to use any goods for any purpose” shall be deemed to be sale. When is the right to use goods said to have been transferred? To appreciate this, a brief journey into the past relating to tax on sale of goods under Entry 54 of List II of the Seventh Schedule to the Constitution of India may be necessary.

The Sale of Goods Act, 1930 defined “sale” as a contract of sale of goods whereby the seller transfers or agrees to transfer the property in goods to a buyer for price. “Goods” means ‘every kind of movable property other than actionable claims and money and includes stock and shares, growing crops, grass and things attached or form part of the land which are agreed to be severed before sale or under the contract of sale’. In the pre-constitution era, for the purpose of sales tax law, the expression “sale of goods” was construed as having the same meaning as in the Sales of Goods Act. Firmly established in State of Madras v Gannon Dunkerley & Co (Madras) Limited[11], this view influenced the sales tax law enormously. In New India Sugar Mills Limited v CST[12], the Supreme Court held that the transfer of controlled commodities pursuant to a Central Government Order is not a sale as defined in the Sale of Goods Act.

2. The basic defect in the present scheme is that a very limited type of economic activity is taxable by the States,-– and other economic activities are not taxable, except by way of excise duties or indirectly by way of stamp duties. This leaves room for loopholes and gaps. It would appear that some day, it will be desirable to consider the possibility of devising a tax which will embrace all transactions which are regarded as adding value or which are entered into with that object.

The Law Commission of India submitted the report on 21.05.1974. Accepting its recommendations, the Government of India proposed to amend the Constitution to include in Article 366, a definition of ‘tax on the sale or purchase of goods’ by inserting a new Clause 29-A and to insert a new Entry 92-A in the Union List in the Seventh Schedule and to amend Article 269(1) and 286(3) of the Constitution of India to be in consonance with the other proposed amendments. As a result, the Constitution (Forty Sixth) Amendment Act, 1982 was enacted which was published in the Gazette on 02.02.1983. Consequently this led to States amending their sales tax laws to enlarge the ambit and width of “sale of goods” for levy of tax. Due to this, a wide variety of economic activities, which were hitherto not considered as sale of goods, came within the fold of State laws. Indeed, as observed by the Law Commission of India, the underlying theme was to devise a tax, which will embrace all transactions which are regarded as adding value or which is entered into with that object. This is reflected in the new definition in Article 366 (29-A), which reads as under.

Definitions (29A) “tax on the sale or purchase of goods” includes— (a) a tax on the transfer, otherwise than in pursuance of a contract, of property in any goods for cash, deferred payment or other valuable consideration; (b) a tax on the transfer of property in goods whether as goods or in some other form involved in the execution of a works contract; (c) a tax on the delivery of goods on hire purchase or any system of payment by instalments; (d) a tax on the transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; (e) a tax on the supply of goods by any unincorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration; (f) a tax on the supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink whether or not intoxicating), where such supply or service, is for cash, deferred payment or other valuable consideration, and such transfer, delivery or supply of any goods shall be deemed to be a sale of those goods by the person making the transfer, delivery or supply and a purchase of those goods by the person to whom such transfer, delivery or supply is made.

The expression ‘tax on sale or purchase of goods’ is an inclusive definition. It must receive a wide and expansive meaning. The latter part of clause (29-A) contemplates that ‘such transfer, delivery or supply of any goods shall be deemed to be a sale of those goods’. The sub-clauses (a) and (b) use “transfer”; Sub-clause (c) uses “delivery”; sub-clause (d) uses “transfer of the right to use goods”, and sub- clauses (e) and (f) use “supply” of goods while defining deemed sale. Thus under the sub-clause (d) there would be deemed sale if the right to use goods is transferred even though delivery is not an essential part of such transfer of the right to use goods. In other words, the moment the right to use goods is transferred, the taxable event happens. When would such transfer of the right to use goods de facto comes within the gravitational field of the species of deemed sale? A score of High Court decisions and half a dozen Supreme Court decisions, notwithstanding, this question remains an unavoidable vexed question. We may, therefore give a brief analysis of the judicial decisions on Article 366 (29-A)(d) of the Constitution which is the basis for Section 5-E of the APGST Act as well as similar provisions in other States’ laws. In Builders Association of India v Union of India[18], the validity of the

Constitution (Forty-sixth) Amendment Act was upheld. But the Apex Court ruled that the States’ power to levy tax on the goods involved in a works contract is subject to the restrictions in Article 286. Article 366 (29-A) was elucidated by the Constitution Bench as below. It refers to a tax on the transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract. The emphasis is on the transfer of property in goods (whether as goods or in some other form). The latter part of clause (29-A) of Article 366 of the Constitution makes the position very clear. While referring to the transfer, delivery or supply of any goods that takes place as per sub-clauses (a) to (f) of clause (29-A), the latter part of clause (29-A) says that “such transfer, delivery or supply of any goods” shall be deemed to be a sale of those goods by the person making the transfer, delivery or supply and a purchase of those goods by the person to whom such transfer, delivery or supply is made. … … The object of the new definition introduced in clause (29-A) of Article 366 of the Constitution is, therefore, to enlarge the scope of ‘tax on sale or purchase of goods’ wherever it occurs in the Constitution so that it may include within its scope the transfer, delivery or supply of goods that may take place under any of the transactions referred to in sub-clauses (a) to (f) thereof wherever such transfer, delivery or supply becomes subject to levy of sales tax. (emphasis supplied)

Inspired by the Forty-sixth Amendment, like many States, Andhra Pradesh It is also enacted a provision on similar lines being Section 5-E of the Act. appropriate to read it here. 5-E. Tax on the amount realized in respect of any right to use goods. – Every dealer who transfers the right to use any goods for any purpose, whatsoever, whether or not for a specified period, to any lessee or licensee for cash, deferred payment or other valuable consideration, in the course of his business shall, on the total amount realized or realizable by him by way of payment in cash or otherwise on such transfer or transfers of the right to use such goods from the lessee or licensee, pay a tax at the rate of five paise in every rupee of the aggregate of such amount realized or realizable by him during the year: Provided that no such tax shall be levied if the total turnover of the dealer including such aggregate is less than Rs.1,00,000.

The challenge to the above provision failed before this Court in Padmaja Commercial Corporation v Commercial Tax Officer[19].

In all probability, for the first time, the scope of above provision fell for consideration before the Division Bench in Rashtriya Ispat Nigam Limited v CTO[20] (RINL-I) comprising Jeevan Reddy and Syed shah Mohammad Quadri, JJ (as they then were). In certain civil works by contractors, RINL provided special machinery like cranes, docers, dumpers, road rollers, compressors etc., for hire charges. The plea was that there was no transfer of the right to use in favour of the contractor. Reliance was placed on the agreement between RINL and the contractor. Whether the transaction amounts to transfer of the right or not cannot be determined with reference to a particular word or clause in the agreement. The agreement has to be read as a whole to determine the nature of transaction. This Court noticed that the contract did not create exclusivity of use, and the contractor was entitled to use the machinery only for executing the work entrusted. Therefore, it was held that the fundamental requirements of Section 5-E are not satisfied.

20. In I.T.C. Classic Finance & Services v CCT[21] the assessee, a finance company, was in the business of hiring out machinery, plant and equipment for rent. After purchasing the goods of required specifications, the manufacturer was advised to consign them directly to the customer on hire under an agreement of lease of the equipment for a period of sixty months or more. As these goods were moved out of the State during the course of interstate trade, in their sales tax return for the year 1988-89, the assessee claimed exemption on the ground that the transaction was not excisable to tax under Section 5-E of the Act. The original authority rejected the contention. The assessee was successful before the Appellate Deputy Commissioner. However, the Commissioner following the judgment of the Bombay High Court in 20th Century Finance Corporation Limited v State of Maharashtra[22] in suo motu revision, set aside the appellate order restoring the original assessment order.

The assessee then filed special appeal before this Court inter alia contending that deemed sales cannot be distinguished from ordinary sales for the purpose of taxation under the Act, and that, the taxable event of delivering the goods having occurred in the State of Tamil Nadu, the same is not excisable under Section 5-E of the Act. Relying on Builders Association and Gannon Dunkerly and Co. v State of Rajasthan[23] the contention was accepted observing thus. In the determination of the inter-State character of a sale, the situs is immaterial. When goods are entrusted to a common carrier for delivery, it amounts to delivery to the consignee and when it takes place outside the State, the fact that subsequently the goods have reached the State where the tax is sought to be imposed, cannot be a ground for determining the tax liability. The decision of the Bombay High Court in 20th Century Finance Corporation Limited, (1989) 75 STC 217, proceeds on the footing that a transfer of the right to use is different from sale without considering the fiction introduced by clause (29-A) of Article 266 of the Constitution. … … The principle that where a State law while defining the expression “sale” makes the situs a relevant consideration for the purpose of determining a deemed sale, the same cannot bring within its ambit inter-State sales or sales in the course of import and export was again emphasized by the Supreme Court in Builders Association of India v State of Karnataka, (1993) 88 STC 248 : AIR 1993 SC 991.

In order to get over the above dicta, by A.P.Act No.22 of 1995, Section 5-E was substituted, which reads as under. 5-E. Tax on the amount realized in respect of any right to use goods: Notwithstanding anything contained in this Act;- (a) Every dealer who transfers the right to use any goods for any purpose, whatsoever, whether or not for a specified period, to any lessee or licencee for cash, deferred payment or other valuable consideration, in the course of his business shall, on the total amount realized or realizable by him by way of payment in cash or otherwise on such transfer or transfers of the right to use such goods from the lessee or licencee, pay a tax at the rate of eight paise on every rupee of the aggregate of such amount realized or realizable by him during the year. (b) the transfer of right to use any such goods entered into by any dealer, shall be deemed to have taken place in this State whenever the goods are used within the State, irrespective of the place where the agreement whether written or oral for such transfer of right is made. Provided that no such tax shall be levied if the total turnover of the dealer including such aggregate is less than Rs.two lakhs[24].

The decision in ITC Classic Finance went in appeal to the Supreme Court. The appeal was heard along with other similar appeals (20th Century Finance Corporation Limited v State of Maharashtra[25]) by a Constitution Bench of the Supreme Court which inter alia considered the import of sub-clause (d) of clause 29- A of Article 366 of Constitution, and the constitutional validity of Section 5-E of the APGST Act and similar provisions in Haryana, Maharashtra, Rajasthan, Uttar Pradesh and Tamil Nadu Acts. By majority of 3:2, Section 5-E(b) was held to be in excess of the legislative power of the State under Entry 54 of List II of the Seventh Schedule to the Constitution. But to save it from being unconstitutional, the Court read down holding that it would not be applicable to the transaction of the transfer of the right to use goods if such deemed sale is (i) an outside sale; (ii) sale in the course of import or export of the goods; and (iii) an inter-State sale.

While holding that, in a contract for the transfer of the right to use goods, the taxable event would be the execution of the contract for delivery of the goods, it was observed. Article 366(29-A)(d) further shows that levy of tax is not on use of goods but on the transfer of the right to use goods. The right to use goods accrues only on account of the transfer of right. In other words, right to use arises only on the transfer of such a right and unless there is transfer of right, the right to use does not arise. Therefore, it is the transfer which is sine qua non for the right to use any goods. If the goods are available, the transfer of the right to use takes place when the contract in respect thereof is executed. As soon as the contract is executed, the right is vested in the lessee. Thus, the situs of taxable event of such a tax would be the transfer which legally transfers the right to use goods.

At this stage, the following principles to the extent relevant may be summed up. (a) The Constitution (Forty-sixth) Amendment Act intends to rope in various economic activities by enlarging the scope of “tax on sale or purchase of goods” so that it may include within its scope, the transfer, delivery or supply of goods that may take place under any of the transactions referred to in sub- clauses (a) to (f) of Clause (29-A) of Article 366. The works contracts, hire purchase contracts, supply of food for human consumption, supply of goods by association and clubs, contract for transfer of the right to use any goods are some such economic activities. (b) The transfer of the right to use goods, as distinct from the transfer of goods, is yet another economic activity intended to be exigible to State tax. (c) There are clear distinguishing features between ordinary sales and deemed sales. (d) Article 366(29-A)(d) of the Constitution implies tax not on the delivery of the goods for use, but implies tax on the transfer of the right to use goods.

To buttress the argument that the essential requisites of the transaction of the transfer of the right to use goods are absent, the counsel relies on Sandeman v Scurr[29], The Omoa Coal and Iron Company v Huntley[30], Baumvoll v Gilchrest[31] and Sea and Land Securities v William Dickinson Company[32] as well as passage from ‘Scrutton on Charterparties and Bills of Lading’ (Twenty-first edn., by Stewart C. Boyd CBE Q.C.). He has also invited attention of this Court to the decisions of the Supreme Court in 20th Century, BSNL, RINL-I and RINL-II, and decisions of various High Courts in Ahuja Goods Agency v State of Uttar Pradesh[33], Lakshmi Audio Visual Inc v Assistant Commissioner of Commercial Taxes[34], Commissioner, VAT, Trade and Taxes Department v International Travel House Limited[35], State of Orissa v Dredging Corporation of India Limited[36] a n d Indian Oil Corporation v Commissioner of Taxes[37].

The Special Counsel for CT relies on the contract between the petitioners and Grasim, and the observations made by this Court in RINL-I as well as BSNL, to refute the petitioners’ case. He also brought to our notice an unreported Judgment of this Division Bench in Jasper Aqua (P) Limited v State of Andhra Pradesh (T.R.C.No.270 of 2010, dated 03.11.2010). He also pointed out that the Judgment of the learned single Judge in Indian Oil Corporation was expressly disapproved in Deepak Nath v ONGC[38].

We have culled out the principles to be applied to determine the nature of the transaction which, according to the revenue, falls within the ambit of Article 366 (29- A)(d). These principles govern the situation here as well. Though we do not feel compelled to refer to all the cited Judgments in detail, and add to the length of this Judgment, we are inclined to summarise these cases in a tabular column below. Before that we propose to begin by making a reference to a passage from Scrutton which lucidly distinguishes the lease (involving transfer of the right to use) and licence in the context of charterparties. Referring to Sandeman, Baumvoll and Sea and Land Securities the learned author classifies charterparties by demise in the following manner. CHARTERPARTIES may be categorized according to whether or not they amount to a demise or lease of the ship. A charter by demise operates as a lease of the ship itself, to which the services of the master and crew may nor may not be superadded.

2. (1988) 70 STC 215 (AP) (SBI v SoAP)

4. (1990) 77 STC 182 (AP) (RINL v CTO) (1990) 77 STC 470 (WBTT) (Modern Decorators v CTO) lockers Bank lockers - Hiring of fixed and/or attached to the walls and embedded in the floors of strong room specially built for the purpose. Th e bank collects rent. – do – dumfors imported like cranes, Sophisticated machinery docers, compressors construction of steel plant. pandals, Constructing barricades, rostrums on land, road, building roof top. Material belongs to decorators. After providing these and collecting rent, they were removed and taken away. They were not handed to the customers. The transaction is not merely transfer of the right to use goods, but involved rendering various services along with a limited right to use the locker. The lease of bank lockers did not come within the meaning of “sale” by transfer of the right to use. Bank lockers embedded in the floor are not “goods” for the purpose of the APGST Act. There is no transfer of right to use and it is only licence to the goods without securing possession. The contract is one of bailment essential requirement of delivery in a “sale” is lacking in hiring of bank locker. Providing machinery to the contractor in connection with the execution of the work does not amount to transfer of right to use the machinery. (NB: Affirmed in RINL-II) The goods are not transferred. The customer has no right to use the materials necessary construction of pandals. The erection of pandals by the decorator is not “sale”, but tables, chairs etc., let out to customers are meaning of “sale” assessable to tax. “goods” within

5. (1991) 83 STC 325 (Ori) (K.C.Behera v SoOrissa)

6. (1993) 88 STC 357 (P&H) (Harbans Lal v SoHaryana) Buses – Bus hired out to State Transport Corpn. The contract disentitled using the vehicle covered by the agreement in any route. The bus was to be run for Corpn. as per the agreement and directions of an officer. kanats, crockery, Tents, utensils, furniture, shuttering material, gas cylinders and buses – These are given on hire to The authorities levied the sales tax on the hire amount under Haryana Act. parties.