IMPORTANT POINT
The main legal point established is that contracts for hiring launch vehicles may be deemed service contracts rather than transfers of the right to use goods, based on the specific terms and conditions of the contracts and the control retained by the contractor.

Heard Ms. N. Hawelia, the learned counsel for the petitioners and Mr. B. Gogoi, the learned Standing Counsel appearing on behalf of the Finance and Taxation Department of the Government of Assam as well as Mr. S. C. Keyal, the learned counsel appearing on behalf of the Service Tax Department of the Government of India.

2. The issue involved in the instant writ petition pertains to whether the transactions in relation to the hiring of two numbers of launch vehicles in connection with construction of the Bogibeel Bridge Project across the river Brahmaputra near Dibrugarh on the basis of the contract agreements dated 08.06.2009 and 04.07.2012 would come within the ambit of ‘sale’ as defined in Section 2 (43) of the Assam Value Added Tax Act, 2003 (for short, ‘the Act of 2003’) or it would be ‘service’ in terms with Section 65 (105) (zzzzj) of the Finance Act 1994.

3. Before dealing with the said question, this Court finds it relevant to take note of the brief facts which led to the filing of the instant writ petition.

4. The petitioner herein entered into an agreement on 08.06.2009 with Northeast Frontier Railway (Construction Organization) (hereinafter for short referred to as ‘the Railway’) whereby the petitioner agreed to supply two launch vehicles on hire charge basis in connection with the construction of the Bogibeel Bridge Project across the river Brahmaputra near Dibrugarh for two years. In terms with the said agreement, it was mentioned that the construction work has to be done on or before 29.12.2010. However, as the work was not completed, a fresh agreement was entered into containing similar terms and conditions on 04.07.2012. During the period of the said contracts, the respondent No.5, i.e. the Service Tax Department of the Government of India demanded from the petitioners to pay service tax on the whole contract value. On the other hand, the Finance and Taxation Department of the Government of Assam also deducted tax on account of VAT from the petitioners. Under such circumstances, the petitioner filed an application before the Respondent No.2, i.e. the Commissioner of Taxes on 11.05.2015 seeking clarification in respect to the contract agreement dated 04.07.2012 as to whether the VAT was required to be paid in respect to the charges received from the respondent Nos.6 to 8. The respondent No.2 gave a clarification to the petitioners vide an order dated 06.06.2015 stating inter-alia that the VAT was not applicable on the charges received in respect to the said contract agreement. Thereupon, the petitioner filed another application on 21.07.2015 seeking clarification in respect to the contract agreement dated 08.06.2009 and the respondent No.2 gave a clarification to the petitioner vide order dated 28.0.8.2015 that the VAT was not applicable on the charges received in respect to the said contract as the same was purely a service contract.

5. The said two orders providing clarification was in terms with Section 105 of the Act of 2003. The petitioners thereupon applied for refund of an amount of Rs.30,09,287/-. The respondent No.3, i.e. the jurisdictional Superintendent of Taxes vide letter dated 09.09.2015 asked the petitioners or the legal representative to appear before him personally along with all relevant documents on 30.09.2015. The respondent No.3 thereafter vide the letter dated 30.09.2015 asked the Officers of the Railway to furnish the TDS certified challans in respect to the petitioner’s firm. The TDS challans were accordingly submitted before the respondent No.3. The respondent No.3 instead of granting the refund vide another letter dated 01.10.2015 asked the proforma respondents, i.e. the Railway to provide the details of the cheque and the amount along with the date of submission of the cheque in respect to the TDS certificate of the petitioner. These documents were also furnished by the proforma respondent No.3 on 05.10.2015. Thereupon, the respondent No.3 vide another letter dated 05.10.2015 asked the pet