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2015 (12) TMI 1630 - HC - VAT and Sales TaxPurchase tax - penalty - By Notification No.336, dated 17.09.1964, there is an exemption granted for sales in the canteen run under the statutory obligations - The Petitioner only buys the provisions, cooks and supplies to the MFL employees on subsidise basis - petitioners claim that the purchases were only from the registered dealers and sales tax was not paid, because there was subsidised supply by MFL as a welfare measure and there was no sale to employees and that there was only a catering service - whether the turnover in relation to the sales effected in the canteen run by the Petitioner during the relevant assessment years is exempt from sales tax by reason of the N/N. 336 of 1964, dated 01.09.1964? Held that: - Under the said notification, the exemption granted is for the sales by all canteens run by an employer or by the employees on cooperative basis on behalf of the employer. The further requirement to be satisfied, before the benefit of that notification can be claimed, is that running of such canteen must be under a statutory obligation without profit motive and the employer should subsidise at least 25% of the total expenses incurred in running the canteen. Whether the petitioner is coming under the category of a canteen run on co-operative basis or not? - Held that: - the Petitioner is an independent contractor and he is not running the canteen on cooperative basis. Therefore, the Petitioner is not entitled to claim exemption provided under the said notification dated 17.09.1964, as he did not satisfy the essential requirements laid down in the notification for claiming the benefit therefor. Since the Petitioner doing business has to produce the books of accounts, but the Petitioner did not maintain and produce the same, in the absence of original purchase bills, the Respondent assessed on the basis of the data available and passed the impugned order, the Petitioner is liable to pay tax. Relying upon the decision of the case of Industrial Catering Services P Limited Vs. Commercial Tax Officer, Chennai [2003 (3) TMI 675 - MADRAS HIGH COURT], penalty set aside. Petition disposed off - direction to the Respondents to re-examine the question of penalty - decided partly against assessee as regards imposition of tax.
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