2016-VIL-225-DEL
TIM DELHI AIRPORT ADVERTISING PVT LTD Vs SPECIAL COMMISSIONER-II,
DEPARTMENT OF TRADE & TAXES
Delhi Value Added Tax Act, 2004 – Section 2(m) – Goods – Section 2(1)(zc) – sale – advertisement hoardings, panels, display boards and kiosks – Levy of VAT on the turnover from display of advertisement on account of deemed sale resulting from transfer of the right to use hoardings, panels, display boards, kiosks
Transfer of any right to use advertising sites – “sale of space or time for advertisement” as defined under Section 65(105) (zzzm) of the Finance Act, 1994 – Payment of service tax
- HELD – The question whether a transaction would fall within the parameters of a deemed sale or a service is essentially a question of fact and would have to be determined in appropriate proceedings. The fact that the Assessee has filed its returns for service tax and also paid service tax may not be determinative of the true nature of the transaction and certainly, the authorities under the DVAT cannot be precluded from independently examining the transactions in question
- Clause (vi) of Section 2(1)(zc) of the DVAT Act is identically worded as clause (d) of Article 366 (29-A) of the Constitution of India – under the expanded scope of “tax on the sale or purchase of goods?, tax on transfer of the right to use goods has been included; this is not the same as a tax on the use of goods and the two expressions cannot be read synonymously. Therefore, for a transaction to fall within the meaning of Section 2(1)(zc)(vi) of the DVAT Act, it is necessary that there should be a transfer of the right to use
- It is not disputed that the sites in question are located in a restricted area and none of the advertisers have an unmitigated access to those Sites; the Petitioner affirms that possession of the Sites is retained by DIAL. Hence, it would be difficult to accept the view that the transactions entered into by the Petitioner with the advertisers constituted transfer of the right to use the Sites in question
- The Tribunal’s decision in Upasana Finance Ltd, to the extent that it holds that possession of the hoardings is not relevant, cannot be accepted in light of the unequivocal view expressed by the Supreme Court in Bharat Sanchar Nigam Ltd – the Special Commissioner to consider the objections filed by the Petitioner in light of the observations made herein without insisting on pre-deposit – appeal disposed