Service Tax or VAT

This query is : Resolved

AZAD BHALLA (Querist)
Follow

13 February 2010 Our Company has taken a part of Factory including Building, Machinery etc. from another Co. on lease in the state of Haryana.

Now I want to confirm the VAT is applicable on this lease charges paid by us or Service tax is applicable ?

As per Haryana VAT Act definitons see below ze(iv) transfer of right to use .....

Also please tell that can if we pay VAT on the same can we claim that amount in input vat.

Thanks

7
(ze) “sale” means any transfer of property in goods for
cash or deferred payment or other valuable
consideration except a mortgage or hypothecation
of or a charge or pledge on goods; and includes –
(i) the transfer, otherwise than in pursuance of a
contract, of property in any goods for cash,
deferred payment or other valuable
consideration;
(ii) the transfer of property in goods (whether as
goods or in some other form) involved in the
execution of a works contract;
(iii) the delivery of goods on hire-purchase or any
system of payment by instalments;
(iv) the transfer of the right to use any goods for
any purpose (whether or not for a specified
period) for cash, deferred payment or other
valuable consideration;
(v) the supply of goods by any unincorporated
association or body of persons to a member
thereof for cash, deferred payment or other
valuable consideration;
(vi) the supply, by way of or as part of any
service or in any other manner whatsoever, of
goods, being food or any other article for
human consumption or any drink (whether
or not intoxicating), where such supply or
service, is for cash, deferred payment or other
valuable consideration,
and such transfer, delivery or supply of any goods
shall be deemed to be a sale of those goods by the
person making the transfer, delivery or supply and a
purchase of those goods by the person to whom such
transfer, delivery or supply is made;
(zf) “sale in the State” in relation to a sale as defined in
sub-clause (ii) of clause (ze) means transfer of
property in goods (whether as goods or in some
other form) involved in the execution of a works
contract in the State;
(zg) “sale price” means the amount payable to a dealer
as consideration for the sale of any goods, less any
sum allowed at the time of sale as cash or trade
discount according to the practice, normally
prevailing in the trade, but inclusive of any sum
charged for anything done by the dealer in respect
of the goods at the time of or before the delivery
thereof and the expression “purchase price” shall
be construed accordingly;

CA. O.P. Agarwalla

CA. O.P. Agarwalla (Expert)
Follow

18 April 2010 Lease tax is applicable on the right touse of goods. Please check the definition of 'goods' and u will find that immovable property does not fall under the ambit of goods.
It has been held by Courts (If I remeber correctly) that machines installed and fixed form part of the immovable property.