2014 (9) TMI 282

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..... rrived at the conclusion that the transaction par takes the character of financial arrangement - such a course is not permissible - once there exists a hire purchase agreement, further questions as to how much part of the consideration of the vehicle was paid by the assessee, and what are the other terms, become immaterial - Realizing that the hire purchase agreements are very complex in nature, t .....

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..... ). The respondent is a financial institution. It entered into a hire purchase agreement with one of its customers in relation to a vehicle. In the return submitted by it, reference was made to such a transaction. In case the transaction between the appellant and the customer is treated as one of extending finance, it attracts Section 8 (3) of the Interest Tax Act, 1974 (for short, the Act) and .....

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..... action in relation to a vehicle in question is termed as hire purchase, it has all the ingredients of a financial transaction. He submits that as against the total cost of the vehicle, only part of it was paid by the respondent and that the ownership of the vehicle was in the name of the lessee under the hire purchase agreement. He contends that these and other ingredients are sufficient to treat .....

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..... security for repayment, the vehicle is hypothecated and endorsement to that effect is made in the registration certificate itself. The second is, where the agency, which arranges the finance, purchases the vehicle in its name, but under an agreement, hires it to the one who availed the facility. The installments that are required to be paid by the lessee of the vehicle would have two components, n .....

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..... issued guidelines and clarifications from time to time. The Tribunal has relied upon the clarifications issued through instruction No.1425, dated 16.11.1981. The relevant portion of it was extracted. Thereafter, the actual contents of the hire purchase agreement and the purport thereof were discussed by the Tribunal, in detail. We are not able to find any defect on facts or in law in the conclusio .....

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