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TMI Blog2024 (6) TMI 501X X X X Extracts X X X X X X X X Extracts X X X X ..... case of M/S. LINDSTROM SERVICES P. LTD. VERSUS PRINCIPAL COMMISSIONER OF GST CENTRAL EXCISE [ 2020 (11) TMI 14 - CESTAT CHENNAI] wherein the Tribunal examined this issue and held that ' In case of termination of the contract, customers / clients shall redeem from the assesse, the work wear that have been in the use.' As the issue has already been settled that if the appellant is paying VAT on the rentals, which is deemed sale, in terms of Article 366(29A) of the Constitution of India, the appellant is not liable to pay Service Tax under the category of supply of tangible goods service, therefore, relying upon the decision of the Tribunal, it is held that the appellant is not liable to pay Service Tax. The impugned order set aside - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before us. 5. The appellant submits that the short issue that is to be decided is whether the supply of computers, monitors, laptops and other IT equipment by the appellant to its customers on rental basis would tantamount to supply of tangible goods service or a deemed sale as per Article 366(29A) of the Constitution of India read with the definition of sale as per the WBVAT Act, 2003. It is his submission that the appellant has already paid VAT on the entire value of such rental income in respect of the equipment, but it has been alleged that as per the terms of the agreement entered into by the appellant with its customers it cannot be stated that the effective control and possession of the asset is with the customers and that the same a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant falls under the category of supply of tangible goods service or not. 8.1. For the sake of argument, it is to be seen as to whether the effective control of the equipment is with the appellant or not. Admittedly, the effective control of the equipment is with the service recipient and on the rental of the equipment, the appellant is paying appropriate VAT. A similar issue came up before the Tribunal, Chennai in the case of Lindstrom Services P. Ltd. (supra) wherein the Tribunal examined this issue and held as under: - 6. The issue that arises for consideration is whether the activity of work wear rental falls under the category of supply of tangible goods so as to attract service tax. The terms and conditions of the agreement ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ose work wear at the same time and hence effective control to lie with the user / clients. The appellant, therefore, does not have control over the use of the work-wear. Thus the activity is not in the nature of service‟ under the Finance Act in both during the period prior to negative list regime and thereafter as held in the impugned order. The order under challenge is therefore not sustainable 8. Further, the Commissioner (Appeals) vide Order-in-Appeal dated 26.12.2017 of Hyderabad Commissionerate has also held in the appellant s own case that work wear does not amount to supply of tangible goods so as to attract service tax. From the decisions cited above, we think it is not necessary to take up the detail discussion of the issue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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