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2022 (12) TMI 1139 - HC - VAT and Sales TaxValidity of assessment order - Deemed sale - transfer of right to use goods or not - inter-state transfer of goods - sale or not - HELD THAT - This court finds force in the argument of Mr. Deb, learned senior counsel on the point that respondents have no jurisdiction and there is no transfer/sale and further the situs of sale - This court is of the considered opinion that the owner of the cylinder is IOCL. The transport/supply does not fall within the ambit of transfer of goods as defined in sale . Further, when transaction has taken place in Assam, the respondent authorities cannot have any jurisdiction over Interstate. The impugned Assessment Order dated 31.03.2021 and consequently, the two demand notices dated 31.03.2021 issued by the respondent no.3 are liable to be set aside and quashed on the point of jurisdiction and also with regard to the right to sale of goods and further with regard to the place of execution of the contract since the situs of the sale which has been executed at Guwahati, the State of Tripura has no jurisdiction in so far as levying of tax by the respondents upon the petitioner - Petition allowed.
Issues Involved:
1. Jurisdiction of the taxing authorities in Tripura. 2. Transfer of right to use goods. 3. Situs of sale. Issue-wise Detailed Analysis: 1. Jurisdiction of the taxing authorities in Tripura: The petitioner contested that the taxing authorities in Tripura had no jurisdiction to levy any tax related to the agreements executed in Guwahati, Assam. The court found merit in this argument, noting that the agreements were executed in Assam, and hence, the situs of sale would be Guwahati, Assam. The court concluded that the State of Tripura had no jurisdiction over the interstate transaction. 2. Transfer of right to use goods: The petitioner argued that there was no "transfer of right to use goods" as per the agreements, which were executed in Guwahati, Assam. The court referred to several precedents, including Indian Oil Corporation Ltd. v. Commissioner of Taxes, Assam & Ors., and Commissioner, VAT, Trade and Taxes Department v. International Travel House Ltd., to determine that a transfer of right to use goods requires parting with possession and effective control of the goods. In this case, the court found that the ownership and control of the LPG cylinders remained with IOCL, and thus, there was no transfer of right to use the goods that would constitute a sale. 3. Situs of sale: The court examined the location where the agreements were executed to determine the situs of sale. It was established that the agreements were executed in Guwahati, Assam. Consequently, the court ruled that the situs of the sale was in Assam, not Tripura. Therefore, the taxing authorities in Tripura had no jurisdiction to levy taxes on these transactions. Conclusion: The court concluded that the impugned Assessment Order dated 31.03.2021 and the demand notices dated 31.03.2021 issued by the respondent no.3 were liable to be set aside and quashed on the grounds of lack of jurisdiction, absence of transfer of right to use goods, and the situs of sale being in Assam. The court allowed the writ petition and disposed of it accordingly.
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