Supply of Tangible Goods Service

This query is : Resolved

shanti kumar maheshwari (Querist)
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30 December 2010 Dear Expert

We are into supply of Imported machines to corporate Hospitals both sale & rentals.

My question is as follows:

Machine given on Lease and collecting CST on the lease rentals as per AP Vat rules @4%. The possession of the machine and the effective control is with the Hospital. In fact, the machine is kept under the lock and key of the hospital only

We would like to know whether this transactions falls under VAT or Service Tax purview?

Shyam Lal Naik

Shyam Lal Naik (Expert)
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30 December 2010 Sir,

Since effective posession and control is with the clients, it is a deemed sale and VAT/CST is attracted.

The case does not fall under the purview of Service Tax.

shanti kumar maheshwari

shanti kumar maheshwari (Querist)
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30 December 2010 Dear Mr. Naik,

In continuation to my question, if it is a deemed sales then what would be the situs of taxable event. To be precise where we have to pay the tax whether under the CST or Under state VAT?

As we are in AP state and the supply is in other states then I think CST is leviable? am I right, Sir. Pl let us know.

Thank You.