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TMI Blog2022 (6) TMI 98X X X X Extracts X X X X X X X X Extracts X X X X ..... LTD. [ 2007 (5) TMI 322 - SUPREME COURT ] where it was held that the cylinders filled with medical oxygen/industrial gas were loaned to the customers. The loan was free from payment of charges for 14 days. The over-retention charges were levied after 14 days. In the circumstances the levy was on the transfer of the right to use the goods for consideration. The cylinder delivery charges and handling/rental charges are liable to be taxed and it was rightly held by the first respondent - there are no infirmity in the order passed by the first respondent warranting interference - petition dismissed. - Writ Petition Nos. 49280 to 49285 of 2006 - - - Dated:- 18-2-2022 - Honourable Mr. Justice R. Mahadevan And Honourable Mr. Justice J.S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ylinders brought by the customers and in such cases, no cylinder holding charges are collected. However, if the customers did not bring their own cylinders, the petitioners sell the gases filled in their own cylinders and collect charges from the customers for the period during which the cylinders are retained by the customers. 3. In this context, the second respondent passed final orders of assessment for the assessment years 1987-88 to 1994-95 (excluding 1989-90) levying sales tax on delivery/rental charges on the ground that the said charges represents pre-sale charges. The second respondent also levied tax on cylinder holding charges under section 3-A of the Act, on the ground that there has been a transfer of right to use the goods, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal, the present writ petitions are filed. 6. The learned counsel appearing for the writ petitioners would contend that the Special Commissioner and Commissioner of Commercial Taxes issued a circular in R.Dis.Acts Cell I dated 13.07.1988 clarifying that charges collected for holding and return of gas cylinders are not liable for tax under Section 3-A of the Act. According to the learned counsel for the petitioners, in view of such clarification, it is not open to the Assessing Officer to levy tax, contrary to the directions of the Special Commissioner and Commissioner for Commercial Tax in the circular dated 13.07.1988. Even otherwise, the delivery charges collected from the customers are separately shown in the sale bills and such amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been excluded in the definition itself cannot be made a part of the sale price, on the basis of the definition of 'sale price' in another enactment. Moreover, the transportation, in this case was undertaken on behalf of the buyer. 10. The Joint Commissioner was clearly in error in holding that the freight and other incidental charges, though billed separately, were to be included in the turnover of the petitioner for assessment, under the Central Sales Tax Act, 1956. The impugned order of the Joint Commissioner is therefore set aside and the appeal is allowed. 7. By placing reliance on the decision of the Division Bench of this Court mentioned supra, the learned counsel for the petitioners prayed for allowing the writ pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r passed by the first respondent and therefore, he prayed for dismissal of the writ petitions. 9. We have heard the learned counsel for the petitioners as well as the learned Special Government Pleader appearing for the second respondent and perused the materials placed on record. 10. The issue involved in these writ petitions is, as to whether cylinder delivery charges and handling charges are liable to be taxed or not. This issue is no longer res integra and it is answered by the Honourable Supreme Court in the decision in State of Orissa and another vs. Asiatic Gases Limited reported in (2007) 7 VST 531 (SC) , relied on by the learned Special Government Pleader for the respondents, mentioned supra. In that case, the Honourable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red by way of loan. In our view, when the said goods (cylinder containing medical oxygen) were given on loan to the customer the transfer of the right to use the said goods came into existence. It may be that for the first 14 days the said loan is free from payment of any charges. However, exemption from payment would not militate against the concept of transfer of the right to use the goods. Thirdly, in the impugned judgment the High Court has failed to notice the provisions of Section 2 (g) (iv) which states that the 'sale' shall mean any transfer of property in goods for cash or deferred payment or for any other valuable consideration and that it shall include transfer of the right to use such goods for any purpose, whether or no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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