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TMI Blog1975 (12) TMI 162X X X X Extracts X X X X X X X X Extracts X X X X ..... e High Court for deciding the appeals on merits. Appeal allowed. - Criminal Appeal Nos 101, 104 of 1971 - - - Dated:- 17-12-1975 - SARKARIA, RANJIT SINGH, CHANDRACHUD, Y.V. AND BHAGWATI, P.N., JJ. V. S. Desai, D. P. Maheshwari and Naresh Sethi for the Appellant A. K. Sen, M. C. Bhandare, Rameshwar Nath and M. K. Gupta for Respondent JUDGMENT SARKARIA, J. The common questions that arise for determination in these appeals on certificate directed against the judgments of the Delhi High Court are : (1) Whether for purposes of the Prevention of Food Adulteration Act, 1954 (for short, the Food Act) there is no sale of food which is provided by a hotelier to a guest when a consolidated charge is made for room and the other amenities, including food, and when no rebate is allowed for any meal which may not be taken by the guest ? (2) Whether the expression store , as used in section 7 and section 16 of the Act, means storage simpliciter or storing for sale? In answer to the first question, the Full Bench of the High Court, to which these questions were referred, held that when a composite charge is made for residential accommodation and food by a hotelier, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ration of Delhi carried an appeal to the High Court. The Division Bench before which that appeal came up for hearing, referred three questions (including the two set out above) to a Full Bench for opinion. Thereafter, the Division Bench, merely on the basis of the answers returned by the Full Bench upheld the acquittal and dismissed the appeals. It will be useful at the outset to have a look at the scheme and content of the relevant provisions of the Act. The broad aim of the Act is to ensure the sale and supply of pure food to the public. With that end in view, the Act prevents adulteration of food articles. For the purpose of the Act an article of food is deemed to be adulterated, if it falls under any of the clauses (a) to (1) of s. 2 (i) This definition of adulterated article of food is of very wide amplitude. Even a sub-standard article would fall within the mischief of sub-clause (1) if the quality or purity of the article falls below the prescribed standard or its constituents are present in quantities which are in excess of prescribed limits of variability . Section 7 prohibits a person to manufacture for sale or store , sell , or distribute , inter alia, any: ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s store and distribute in s.16 (1) will be further clear from a reference to s. 10. Under that section, the Food Inspector, to whom the Act assigns a pivotal position for the enforcement of its provisions, is authorised to take samples of an articles of food only from particular persons indulging in a specified course of business activity. The immediate or ultimate end of such activity is the sale of an article of food. The section does not give a blanket power to the Food Inspector to take samples of an article of food from a person who is not covered by any of the sub-clauses of sub-s. 1 (a) of sub-s. 2. The three sub-clauses of sub-section 1(a) apply only to a person who answers the description of a seller or conveyer, deliverer, actual or potential, of an article of food to a purchaser or consignee or his consignee after delivery of such an article to him. Sub-section (2) further makes it clear that sample can be taken only of that article of food which is manufactured , stored or exposed for sale. It follows that if an article of food is not intended for sale and is in the possession of a person who does not fulfil the character of a seller, conveyer, deliverer, consign ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the subject or context,- (h) sale means any transfer of property in goods other than goods specified in Schedule for cash or deferred payment or other valuable consideration, but does not include a mortgage, hypothecation, charge or pledge. Explanation-(1) A transfer of goods on hire- purchase or other instalment system of payment shall, notwithstanding that the seller retains a title to any goods as security for payment of the price, be deemed to be a sale. In the Food Act sale has been defined as under: In this Act unless the context otherwise requires- sale with its grammatical variations and cognate expressions means the sale of any article of food, whether for cash or on credit or by way of exchange and whether by wholesale or retail, for human consumption or use, or for analysis, and includes an agreement for sale, an offer for sale, the exposing for sale or having in possession for sale of any such article, and includes also an attempt to sell any such article. A comparative study of the above-quoted definitions would show that the connotation of sale for purposes of the Food Act is far wider than the meaning assigned to it in the Sales-t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n item of taxable turnover for the relevant account year. Such considerations or difficulties do not arise for the purpose of the Food Act. The primary object of the Food Act is to prevent, in the interest of the health of the community, the supply of adulterated foodstuffs by a person as a part of his business activity. The definitions of the term 'sale' have in terms, been made subject to the context of the respective Acts in which they occur. Consequently, in judging whether a transaction is a sale or not, due regard must be had to the purpose, scheme and context of the particular Act under which the question arises. The learned Judges of the High Court appear to have overlooked the important distinction between the connotation of 'sale' for purposes of the Sales-tax Act and the one under the Food Act. For the purposes of the Food Act, the broad test applicable would be whether the article of food was offered by the hotelier to the resident customer for a money consideration, it being immaterial whether such consideration was a distinct item or was an inseparable element of the consolidated charge made by the hotelier for providing residential accommodat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od Act. Even so, if such a test is applied consistently with the object of the transaction and the intention of the parties while entering into is nevertheless a commercial transaction. Surely, the dominant object of the transaction and the intention of the parties while entering into the transaction in question was to provide against payment, whole some food for consumption besides residential accommodation and services. Good residential accommodation and good food against one consolidated charge were the main considerations which must have weighed with the parties while entering into this transaction. It is therefore not correct to say that the supply of food under such a composite transaction entered into between the hotelier and his resident customer does not amount to supply of food as an article of commerce. The fact remains that the supply or offer of food to such a customer is for a money consideration as a part of business, activity, and as such, constitutes sale under the Food Act. It is true that in pursuance of such a transaction, the bill prepared by the hotelier is one and indivisible; it is not capable of being proximated or split into charges for food and charg ..... X X X X Extracts X X X X X X X X Extracts X X X X
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