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TMI Blog2014 (5) TMI 720X X X X Extracts X X X X X X X X Extracts X X X X ..... o has to be with the transferee - In the absence of any elements, viz., the goods, the transfer of right to use the goods, the said transaction could not be brought under the provisions of Section 3A. The Tribunal had held that the hoardings are part of the immovable property which are not dismantled to be called as goods - There is nothing on record to show that the hoardings were detachable and remained as goods to be used as and when they were required for the assessee to render its services as an advertisement agency - The hoardings erected on the concrete foundation not capable of removal without causing any damage to the structure is part of the immovable property and ceased to be goods for the purpose of attracting levy of tax und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cision of the 89 STC 1 SELVEL ADVERTISING PVT. LTD v. C.T.O., and thus made the assessment. Aggrieved by the same, the assessee went on appeal before the Appellate Assistant Commissioner who pointed out that the Assessing Officer had not indicated in his order as to how the elements of transfer, right to use and goods were present in assessee's case. The Appellate Authority further pointed out that since there was no transfer of possession and that the hoardings are part of the immovable property, the question of attracting charge under Section 3 A of the Tamil Nadu General Sales Tax Act did not arise. Thus, the Appellate Authority allowed the appeal filed by the assessee. 2. On further appeal by the Revenue before the Sales Tax Appellate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the case of transfer of right to use, the essence of the transfer is the passage of control over the economic benefit of the property. As the transfer of right to use the goods is a deemed sale, the transaction in question attracts Section 3A of the Act. In the light of the decision of the Tamil Nadu Taxation Special Tribunal, the assessee thus transferring its benefit to use the hoardings, provision of Section 3A of the Act stood attracted. 4. Per contra, learned counsel for the assessee pointed out that considering the findings of the Tribunal that the hoardings were part of the immovable property, levy of tax under Section 3A of the Act was rightly cancelled by the Tribunal. She also drew our attention to the decision of the Andhra P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... removed without causing damage to the hoardings, the Tribunal granted relief to the assessee. Thus the factual findings herein as to how the hoardings are used as part of the immovable property, certainly goes against the Revenue's plea herein. 8. In the decision reported in 113 STC 403 UPASANA FINANCE LIMITED v. STATE OF TAMIL NADU, the Tamil Nadu Taxation Special Tribunal considered the vires of Section 3 A of the Act. While upholding the provisions of Section 3A of the Act, the Tribunal pointed out that in the case of transfer of right to use, the essence of the transfer is the passage of control over the economic benefit of the property. In other words, there must be a transfer or effective control over the goods that the other party ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the period of contract. Thus, the decision referred to above laid down as a matter of principle of law that only goods can be a subject matter of sale as well as of a deemed sale. In order to bring the transaction under the provisions of Section 3A relating to transfer of right to use the goods, the transferee must have control over economic benefit of the property, in which event, the possession also has to be with the transferee. In the absence of any elements, viz., the goods, the transfer of right to use the goods, the said transaction could not be bring under the provisions of Section 3A of the Act. 9. As already pointed out by us, the findings of the Tribunal herein remain unchallenged. The Tribunal held that the hoardings are part ..... X X X X Extracts X X X X X X X X Extracts X X X X
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