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Amended provision cannot be held to be unconstitutional so long as Parliament has the legislative co

Raj Kumar Makkad ,
  24 September 2010       Share Bookmark

Court :
Madras High Court
Brief :
Writ petition - Writ of declaration - Service tax liability - Software - End-userlicense agreement - Until 16th May 2008 no service tax was levied in the case of sale of canned software license - By virtue of new provision of Clause (zzzze), information technology software also brought under the meaning of "taxable service" - That amendment was brought in by virtue of residuary power under Entry 97 of List I of Schedule VII - Whether provisions of Section 65(105)(zzzze), particularly Sub-clauses (v) and (vi), are unconstitutional and contrary to provisions of Articles 14, 19(1)(g), 265 and 268A?
Citation :
Infotech software Dealers Association v. Union of India (uoi) Ministry of finance Department of Revenue Central Board of Excise and Customs (decided on 24.08.2010)

Held, whether software is goods or not is no longer res integra. Software is goods and whether the transaction would amount to sale or service would depend upon the individual transaction, i.e. end-user license agreement . Amended provision cannot be held to be unconstitutional so long as Parliament has the legislative competency to enact law in respect of tax on service in exercise of powers under Entry 97 of List I of Schedule VII .Amendment not contrary to provisions of Articles 245, 265 and 268A .Writ petitions dismissed.

 
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Published in Taxation
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