9911796707
TMI Blog2018 (3) TMI 412X X X X Extracts X X X X X X X X Extracts X X X X ..... ve held the above activities to be eligible for credit - the disallowance of credit on the impugned services except club services are eligible for credit. Appeal allowed - decided in favor of appellant. - ST/41062 & 41063/2013 - A/43368-43369/2017 - Dated:- 14-12-2017 - Ms. Sulekha Beevi C.S., Member (Judicial) And Shri Madhu Mohan Damodhar, Member (Technical) Shri C. Saravanan, Advocate - for the Appellant Shri K.P. Muralidharan, AC (AR) - for the Respondent ORDER Per Bench The appellants are aggrieved by the demand of service tax under the head 'Supply of Tangible Goods' as well as the credit disallowed on input services. 2. The appellants are engaged in various services such as Advertising, Online Information, Video Tape Production, Sound Recording Service etc. The appellant owns Qube Digital video format used for recording and playback of video. They import digital projectors and components and manufacturer Servers in their factory premises and remove the same on payment of excise duty for installation in theatres. The Digital Projector Systems are provided to theatre owners either on sale basis or on right to use basis. They canv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... long with interest and also imposed penalties. Hence this appeal. 3. On behalf of the appellant, Id. counsel Shri C. Saravanan started his arguments by adverting to the definition of Supply of Tangible Goods services. He submitted that as per section65(105)(zzzzj), the activities would become supply of tangible goods when the right to use the equipment is transferred without transferring right of possession and effective control of such machinery. That appellant had transferred possession and also effective control of the said equipment. Therefore, the transfer of the right to use the equipment will not attract the levy of service tax under supply of tangible goods services. It is also argued by him that the appellant is discharging VAT on the said activity and the transfer of goods is defined under Article 306(29A)(d) of the Constitution, which deals with deemed sale. Since the appellant have discharged VAT on the said services, and VAT and Service Tax being mutually exclusive, the appellant cannot be called upon to pay service tax on the very same amount collected from their customers. To support his argument, he relied upon the decision of the Hon'ble High Court of Andhra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal Image Media Technologies Pvt. LTD. (RIMT) shall supply and install on a right-to-use basis, the equipments viz., QCP, 3-Chip DLP Projectors and Anamorphic Lens at the Theatre along with the required connections (Clause I) 2. RIMT will carry ort pre-installation check and post installation, RIMT shall provide basic training to operators at the Theatre, on operation and system reset procedures for facilitating routine operation of the Equipment by the Theatre personnel (Clauses 2 3) 3. All maintenance work relating to the Equipment shall only be carried out by authorized engineers of RIMT/its service providers. Clause 4 of the Letter of Undertaking specifically states that the Theatre Owner shall ensure that his/its personnel/employees do not open, tamper with or remove or dismantle the Equipment 4. In consideration of the supply, installation and maintenance of the Equipment at the Theatre, the Theatre owner shall pay RIMT a refundable deposit of Rupees One lakh in addition to recurring per-show fee of ₹ 250/- per screen for the digital film content screened at the theatre through the Equipment (Clause7) 5. Clause 14 of the Letter of Undertaking sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Taxable services means any service provided or to be provided 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 possession and the effective control of such machinery, equipment and appliances. From the above definition, when there is supply of use of equipment without transferring right of possession and effective control of the equipment, the same would fall within the category of supply of tangible goods service. The department contends that the theatre owners do not have any right of possession of the equipment and that the appellants have not transferred the right of possession. That since the appellant has retained certain rights and also put down conditions that the theatre owners shall ensure that the appliances connected to the VSAT remains switched on all times that is 24 hours a day in order to enable the appellant to have access to the QCP would amount to retaining the effective control over the equipment. In the decision of GS. Lamba Sons Vs. State of Andhra Pradesh (supra), the Hon'ble High Court has summarized the meaning and transfer of p ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
