TMI Blog1967 (5) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... petition (now respondents) own a chain of hotels, one of them being the Cecil Hotel, Simla, and another Mount View Hotel at Chandigarh. They had been registered since 30th March, 1949, as dealers under the Punjab General Sales Tax Act, 1948 (Act No. 46 of 1948), hereinafter to be referred to as the Act. One of the main lines of their business activity is to provide residential accommodation and their tariff for the persons staying in their hotels is an inclusive one for lodging as well as three principal meals, viz., breakfast, lunch and dinner. The company has put on the record a printed copy (annexure 'A') of the terms and conditions which, according to them, constituted an agreement under which rooms were allotted to the visitors and whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant in the hotel premises. The Excise and Taxation Officer vide his reply dated the 12th September, 1958, repelled the objection holding that the company while providing meals to the resident visitors of the hotel was making sale of the food to them. The company then filed an application for revision under section 21 of the Act before the Excise and Taxation Commissioner, Punjab, Patiala. This revision petition remained pending till November, 1963, and in spite of protests on behalf of the company the Excise and Taxation Officer assessed them to tax for the year 1960-61. On the 19th December, 1963, the writ petition giving rise to this Letters Patent Appeal was filed. In the return on behalf of the respondents to the writ petition a preli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... price; and (iv) Passing of title. The power to impose sales tax is relatable to entry 48, viz., sale of goods, in List II of the Seventh Schedule to the Government of India Act, 1935, which was in force when the Punjab Act was originally put on the statute. That particular entry corresponds to entry 54 in the State List in the Seventh Schedule to the Constitution of India. The Supreme Court in the State of Madras v. Messrs Gannon Dunkerley and Co. (Madras) Limited[1958] 9 S.T.C. 353; A.I.R. 1958 S.C. 560. construed with reference to the definition of sale as contained in section 2(h) of the Madras General Sales Tax Act (Act No. 9 of 1939) and entry 48 in List II of the Seventh Schedule to the Government of India Act, 1935, that the esse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f two distinct agreements, one for the sale of materials and another for work and labour, and in such a case, it would be competent to the State to impose tax on the sale of materials even construing that word in its narrow sense. Another judgment of the Supreme Court cited before the learned Single judge was The Government of Andhra Pradesh v. Guntur Tobaccos Limited[1965] 16 S.T.C. 240. The question, which was to be determined, was whether the company was liable to pay sales tax under the Madras General Sales Tax Act, 1939, on the value of the packing materials used by it for storage of dried tobacco and it was held in the majority judgment that in the absence of any evidence from which contract to sell "packing material" for a price mi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was further pointed out that the company's hotel also supplies packed lunches and dinners, the price of which could form a basis for splitting up the charges, viz., for lodging etc. and for meals. He also referred to condition No. 7 according to which room service is provided on a charge of Re. 1 per meal and he said that on these bases the value of the amenities such as crockery and cutlery etc. could also be estimated. These are all, however, questions of fact, which were not at all agitated before the learned Single judge, and at the hearing of the writ petition before him the facts appear to have been admitted. Then Mr. T.S. Munjral maintained that during the pendency of the writ petition the facts were still being gone into by the A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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