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TMI Blog2013 (3) TMI 273X X X X Extracts X X X X X X X X Extracts X X X X ..... sale’ and the sales tax and service tax being mutually exclusive to each other, the confirmation of service tax against the appellants is not justified. The appellants has a good prima facie case in its favour. - stay granted. - ST/186/2011 - 281/2012 - Dated:- 4-5-2012 - Ms. Archana Wadhwa, Dr. Chittaranjan Satapathy, JJ. REPRESENTED BY : S/Shri N. Venkatraman, Sr. Advocate and Muthuvenkatraman, Advocate, for the Appellant. Shri V.V. Hariharan, JCDR, for the Respondent. [Order per : Archana Wadhwa, Member (J)]. The prayer in the application is to dispense with the condition of pre-deposit of service tax of Rs. 1,53,13,956/- confirmed against the applicants for the period May 2008 to Oct. 2008 and penalties impose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ownership, title and effective control to the applicants over the leased out aircraft. Such functional permission flows after all out of the temporary possession and operational control of the aircrafts which are bare essentials for operating the lease. As such, he has concluded that it is a case of supply of tangible goods by the lessor, M/s. EAT without transfer of right to ownership, possession and control of the aircraft. 5. At this stage, we may reproduce the definition of supply of tangible goods , as appearing in Section 65(105)(zzzzj) of the Finance Act, 1994 as under :- to any person, by any other person in relation to supply of tangible goods including machinery, equipment and appliances for use without transferring right of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aircrafts by a client only confers him with the right to use the aircraft and the owner of the aircraft in such case does not transfer right of possession. As to whether effective control over the aircraft is transferred or not would be a question of fact to be determined in each case. Where the crew is also provided by the owners of the aircrafts as in a wet lease of aircraft effective control is not transferred. 3. You may examine the facts of each case of aircraft leasing in your jurisdiction and take action to recover tax wherever due. A list of the non-scheduled operators (permit holders) is enclosed herewith. A report in the present position of collection of service tax paid in chartering of aircrafts and the further action based on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-clause (d) of the said Article, tax on the sale or purchase of goods included a tax on transfer or right to use any goods for any purpose for cash. The fact that the same is for specified period will not alter the status of the deal. Ld. senior advocate clarifies that in terms of the said provision, the deal between the appellants and M/s. EAT is required to be treated as deemed sale so as to be covered by the provisions of sales tax. However, on being questioned, he clarifies that no sales tax is being paid on the said deal, on account of import of the aircraft, which is covered by exemption in terms of provisions of Section 5 of the General Sales Tax Act, 1956. Nevertheless, he submits that inasmuch as the deal is required to be con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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