Set Top Boxes Confirmed as Taxable Goods Under Section 2(15), Subject to Both VAT and Service Tax

HC ruled on VAT applicability to Set Top Boxes (STBs) under Karnataka VAT Act 2003. STBs were determined to be goods under section 2(15), capable of exclusive subscriber use with transfer rights for Rs. 2,000 consideration. Court upheld concurrent findings that STBs constitute taxable goods despite service component, rejecting argument of mutual exclusivity between service tax and VAT. Assessees' contention that government notification dated 15.03.2021 couldn't have retrospective effect was dismissed. HC affirmed that tax regime during transition between 2003 Act's repeal and 2017 Act's enactment wasn't intended as tax haven. Revision petition challenging VAT assessment on STBs dismissed, confirming dual applicability of service tax and VAT based on distinct taxing incidents. .....

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