TMI Blog1980 (9) TMI 251X X X X Extracts X X X X X X X X Extracts X X X X ..... neither in the handwriting of any of the partners nor employees of the dealer and that there is no intrinsic evidence to connect the slips with the dealer's business. The Appellate Assistant Commissioner noted that slip No. 1 showed the trading results of the business for a whole year, that there is a reference to purchases and sales and that, in view of the statement of the managing partner at the time of inspection, it should be held that these slips related to the business of the dealer. In that view, he came to the conclusion that the assessing authority was justified in coming to the conclusion that the sale amount of Rs. 9,56,569 as noted in the slips, related to the appellant's business in 1972-73 and the addition to the turnover was correct. All the same, the Appellate Assistant Commissioner held that there was no specific finding that there was a wilful non-disclosure of the transaction found in the slips and that, therefore, no penalty could be levied. Accordingly, he cancelled the penalty. The dealer preferred an appeal before the Tribunal questioning the addition on the ground of escaped turnover. The revenue filed T.M.P. No. 2 of 1977 before the Tribunal praying to res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of 1977 before the Tribunal was not maintainable and the order of the Tribunal in so far as it levied Rs. 1,500 as penalty was without jurisdiction and is liable to be set aside and that portion of the order is accordingly set aside. Coming to the merits of the redetermination of the turnover under section 16, the case of the learned counsel for the dealer is that though the slips were recovered from the business premises of the dealer, they did not relate to the business of the dealer as such and that, therefore, on the basis of those slips neither could it have been held that any turnover has escaped assessment or the turnover was suppressed, nor could the turnover have been enhanced. The petitioner has also filed T.C.M.P. No. 23 of 1980 praying to permit to raise additional ground in respect of this addition to the original turnover. The ground sought to be raised is that in view of the decision of the Supreme Court in Northern India Caterers (India) Ltd. v. Lt. Governor of Delhi [1978] 42 S.T.C. 386 (S.C.). , the supply of articles of food in the dealer's restaurant cannot be regarded as sale and that, therefore, the turnover relating to the same could not be included in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... state the ratio of the judgment of the Supreme Court as that was the subject-matter of controversy at the Bar. While the learned Government Pleader would contend that the application of the decision of the Supreme Court in Northern India Caterers (India) Ltd. v. Lt. Governor of Delhi[1978] 42 S.T.C. 386 (S.C.)., as explained in the review order reported in 45 S.T.C. 212, will have to be restricted to food and drinks supplied in residential hotels or restaurants attached to residential hotels and not generally to all the restaurants where such food is supplied, irrespective of the fact whether the food is consumed in the hotel itself or whether it is purchased and taken home. On the other hand, the learned counsel for the dealer argued that in spite of the review order the original decision stands and the supply of food by a hotelier is not at all taxable under the Tamil Nadu General Sales Tax Act as it would not amount to a sale. In the decision in Northern India Caterers (India) Ltd. v. Lt. Governor of Delhi[1978] 42 S.T.C. 386 (S.C.)., the two questions that were considered were: (1) Whether the supply of meals to residents, who paid a single all-inclusive charge for all servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed States by an enactment of the Uniform Commercial Code which provided in effect that the serving for value of food or drink to be consumed either on the premises or elsewhere constituted a sale. Coming to the decision in India, the Supreme Court referred to the decision in Associated Hotels of India Ltd.[1972] 29 S.T.C. 474 (S.C.). and after noting that that case related to the food and drinks supplied to guests residing in a hotel, observed that there is no distinction in law between the meals supplied to a resident in a hotel and those served to a customer in a restaurant. The Supreme Court further observed: "Like the hotelier, a restaurateur provides many services in addition to the supply of food. He provides furniture and furnishings, linen, crockery and cutlery, and in the eating places of today he may add music and a specially provided area for floor dancing and in some cases a floor show." In that view it was held that the service of meals to visitors in the restaurant of the appellant therein was not taxable under the Bengal Finance (Sales Tax) Act, 1941, as extended to the Union Territory of Delhi, and this is so whether a charge is imposed for the meal as a whole ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... governed by standard rule. In mere restaurants and non-residential hotels, many of these transactions are sales and taxable. Nor are additional services invariably components of what you pay for. You may go to an air-conditioned cloth-shop or sweetmeat store or handicrafts emporium where cups of tea may be given, dainty damsels may serve or sensuous magazines kept for reading. They are devices to attract customers who buy the commodity and the price paid is taxable as sale. The substance of the transaction, the dominant object, the life-style and other telling factors must determine whether the apparent vendor did sell the goods or only supply a package of services. Was there a right to take away any eatable served, whether it be bad manners to do so or not? In the case we have, the decision went on the ground that such right was absent. In cases where such a negative is not made out by the dealer-and in India, by and large, the practice does not prohibit carrying home-exigibility is not repelled." It may be seen from the review order as also from the earlier judgment that it matters not whether the food was served in a residential hotel or a restaurant attached to that hotel or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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