HIRING GOODS TO USE

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This query is : Resolved

JAVED SHEIKH (Querist)

16 February 2009 A Co is giving movable goods like barges, tugs, trucks on quantity basis to B Co.

B Co then give these goods to use to C Co on monthly basis. C co has the ultimate control of these goods.

Which tax is applicable between A and B and C, Service Tax or VAT.

Kindly specify your reply with citation of exact provision and case laws if any.

thanks

javed

CA Nitin Wadhwani

CA Nitin Wadhwani (Expert)

16 February 2009 Service Tax under the head "Business Support Services".

Rajesh Kumar

Rajesh Kumar (Expert)

17 February 2009 It appears that transfer of right to use is being made with transfer of possession and control. It amounts to sale as per constitution- VAT is payale.
If there is no transfer of possession or control,service tax is payable under tangible goods service under Section 65 (105)(zzzj).

JAVED SHEIKH

JAVED SHEIKH (Querist)

17 February 2009 If A co is diretly giving such goods to C Co on monthly basis

OR

If A Co is giving such goods to B Co on monthly basis

then the situation will remain same or change

Rajesh Kumar

Rajesh Kumar (Expert)

03 March 2009 One of the two- either VAT or service tax- is payable.
The exact nature of transaction is based on your private agreement.

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