2025-VIL-1719-CESTAT-HYD-ST
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SERVICE TAX CESTAT Cases

Service Tax - Deemed Sale vs Supply of Tangible Goods Service, Transfer of Right to Use and Effective Control of Goods - Appellant entered into an agreement with Fortis Healthcare Ltd (FHL) for providing a Laser Revolix Laser equipment and related services to FHL for performing laser procedures on patients - Department considered this as a Supply of Tangible Goods (SOTG) service under the Finance Act 1994 and not a deemed sale, and hence raised a service tax demand - Whether the transaction between the appellant and FHL involves a transfer of the legal right to possess and effective control of the equipment, amounting to a deemed sale, or is it a case of SOTG service without such transfer - HELD - The transaction does not satisfy the criteria for a deemed sale. While the agreement provided for the appellant to install the equipment in FHL's premises and FHL to bear certain responsibilities, the overall arrangement indicates that the appellant retained the effective control and right to use the equipment, making it a case of hiring of equipment rather than a transfer of the right to use. The invoicing also showed the charges were on a per-procedure basis, further supporting the finding that it was a SOTG service and not a deemed sale. Therefore, the transaction between the appellant and FHL is a Supply of Tangible Goods (SOTG) service and not a deemed sale, as the appellant did not transfer the legal right to possess and effective control of the equipment to FHL - The appeal is devoid of merit and is accordingly, dismissed
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