CST Vs. ITD ITD-CHEM JOINT VENTURE
LAWS(CE)-2015-1-96
CUSTOMS EXCISE AND GOLD(CONTROL) APPELLATE TRIBUNAL
Decided on January 27,2015

Cst Appellant
VERSUS
Itd Itd -Chem Joint Venture Respondents

JUDGEMENT

R.K. Singh, J. - (1.)F. Order No. 50320/2015.
(2.)STAY application along with appeal has been filed by Revenue against order in appeal dated 29.1.2014. The respondents filed a refund claim of Rs. 11,25,05,830/ - in respect of service tax paid wrongly by them inasmuch as they paid service tax under the category of supply of tangible goods service [Section 65(105)(zzzj) of Finance Act, 1994]. The respondents entered into an agreement with M/s. Italian Thai Development Public Company Ltd. in terms of which the scope of lease was as under:
The ownership of the leased plant and equipment supplied by the Lessor shall remain with the Lessor before and after the lease agreement. However, during the duration of this agreement, the leased plant and equipment supplied by the lessor shall be under the custody and possession of the Lessee. The Lessor hereby agrees that it will not remove the plant and equipment without the prior written consent of the Lessee. Therefore, it is clearly mentioned in the agreement that the lessor will not have any authority to remove the plant and equipment without written permission of the lessee during the duration of the agreement. This means that the lessor has lost the right of possession or transferred the right of possession in favour of the lessee despite the fact the ownership of the leased plant and equipment remained with the Lessor. Hence I find that the Right of possession was with the lessee, the party, during the contract period.

The Commissioner (Appeals) in his impugned order held that in terms of the said lease agreement the said transaction did not fall within the category of supply of tangible goods service as defined under Section 65(105)(zzzj) ibid.

(3.)DURING the hearing, the respondents have contended that the issue is squarely covered in their favour by the judgment in the case of Petronet LNG Ltd. v. CST, New Delhi : 2013 -TIOL -1700 -CESTAT -DEL.
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