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 user 2005-09-17 at 11:45:00 am Views: 51
  • #12840

    Xerox`s sales tax plea dismissed

     New Delhi September , 2005

    The Supreme Court has
    dismissed the appeal of Xerox Modicorp Ltd against the judgment of the
    Karnataka High Court holding that the materials used in the “full
    service maintenance agreement” and the “spares and service maintenance
    agreement” were liable for sales tax.
    In the first type of agreement, the company took the responsibility for
    maintaining the machine, including replacement of parts during service.
    In the second agreement, the company supplied materials like toners and
    developers and charged for it. The revenue authorities contended that
    the spare parts and goods supplied under the service agreements
    amounted to sale. The company argued that the transfer of goods was an
    inseverable part of the agreement.
    The Supreme Court held that there was transfer of property in tangible goods and duty was payable.