Case Law Details
Court: Supreme Court
Citation: Association of Leasing & Financial Service Companies Versus Union of India and others
Brief: The service tax in the present case is neither on the material nor on sale. It is on the activity of financing/ funding of equipment/ asset within the meaning of the words “financial leasing services” in Section 65(12)(a)(i).- the appellant(s) had moved the High Court in the writ petition challenging the validity of Section 66 of the Finance Act, 1994 on the value of taxable services referred to in Section 65(105)(zm) read with Section 65(12)(a)(i) without exhausting the statutory remedy.
The contracts entered into by the appellant(s) with its customers were not vetted. There has been no adjudication under the Act in most of these cases and, therefore, we hereby direct the competent authority under the Finance Act, 1994 to decide the matter in accordance with the law laid down. Subject to above, for the afore-stated reasons, we hold that the service tax imposed by Section 66 of the Finance Act, 1994 (as amended) on the value of taxable services referred to in Section 65(105)(zm) read with Section 65(12) of the said Act, insofar as it relates to financial leasing services including equipment leasing and hire-purchase is within the legislative competence of the Parliament under Entry 97, List I of the Seventh Schedule to the Constitution.
Bench: S Kapadia, K Radhakrishnan, S Kumar
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