2007 (8) TMI 67

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..... ch find place in Chapter V of the Finance Act, 1994 and Chapter VA of the Finance Act, 2003. 2. The writ petitioner accordingly has presented this writ petition to nip the whole process in the bud, and has asked for an interim order staying all further proceedings. 3. The writ petitioner has been in business from 1998 and has been purchasing Sikkim Lottery tickets in bulk. 4. A very important fact about the purchase if not mentioned or even hinted at in the petition at all, and this is, that the purchase of the lottery tickets is made for a price of Rs. 70/- for tickets of the face value of Rs. 100/-. Learned counsel for the writ petitioner has made this submission on query from Court and, accordingly, it is now to be proceed upon as a f .....

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..... te Government still less of marketing any goods belonging to the State Government. 9. Accordingly, the root of the service tax incidence, which is the said sub-section 19 disappears and service tax cannot be levied because no service could be provided by anybody who is dealing with goods which are fully owned by and fully belong to that person itself. 10. The impugned letter, above referred to, adopts the line of reasoning, that the sale of lottery tickets being prohibited except by the Government itself or through distributors or selling agents, the sale of such tickets by the State Government to the writ petitioner must be on the footing that the writ petitioner is a distributor or a selling agent of the State Government, since otherwis .....

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..... hich are of the face value of Rs. 100/-, and can be sold in the market for that face value, is itself a promotional or marketing service. The contract between a principal producer and its large distributor or promotional distributor can have a lot of flexibility. It will all depend on the business negotiations by the two parties, as to whether the goods are being taken by the distributor as an agent, and retained as such, or whether the goods will be purchased outright by the distributor from the manufacturer, at a reduced price, the distributor thereafter taking all responsibility for the goods purchased, in return for, or in consideration of, the reduction in the wholesale price of goods. 17. If, we repeat if, the writ petitioner is a di .....

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