The Supreme Court today restrained Maharashtra government from imposing penalty on the sales tax levied on Tata Sons Ltd over the use of the TATA brand name by its subsidiaries.
A bench of Chief Justice H L Dattu and Justice Amitava Roy stayed the levy of penalty on the sales tax after senior advocate Harish Salve, appearing for Tata Sons, said the firm has “already paid the entire tax (Rs 300 crore) and a small amount of penalty” remained.
The sales tax demand relates to the royalty amount collected by the company on the use of ‘TATA’ brand name by its subscribing firms.
The apex court admitted the company’s appeal against the Bombay High Court order in the case.
Tata Sons had approached the apex court challenging a Bombay High Court order which had ruled in favour of the Maharashtra sales tax department, upholding its decision to collect tax from Tata Sons under the state’s ‘Transfer of Right to use any Goods for any Purpose Act, 1985’.
Tata Sons sought clarity on taxability of transaction of transfer of right to use the trademark assigned to its group companies.
( Source – PTI )