TMI Blog1987 (9) TMI 396X X X X Extracts X X X X X X X X Extracts X X X X ..... t carrying on business in sale of food articles?" 2.. The aforesaid question arises out of the order of the Appellate Tribunal in second appeal in the following circumstances: The non-applicant-assessee being a registered dealer, was assessed to sales tax for the calendar year 1977. The canteen sales in the factory premises of the assessee amounting to Rs. 6,02,277 were assessed to sales tax at 2 per cent by the Assistant Commissioner, Sales Tax, Indore. In first appeal, the order of assessment was maintained by the Additional Appellate Deputy Commissioner, Sales Tax, Indore. In second appeal, the Board of Revenue 'functioning as "Tribunal", held that the canteens were established under section 46 of the Factories Act, 1948 and the domi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... food is supplied in an eating-house or restaurant, and it is established upon the facts that the substance of the transaction, evidenced by its dominant object, is a sale of food and the rendering of service is merely incidental, the transaction would undoubtedly be exigible to sales tax. In every case, it will be for the taxing authority to ascertain the facts when making an assessment under the relevant sales tax law and to determine upon those facts whether a sale of the food supplied is intended." 4.. In the instant case, the canteen in question is maintained for the use of the workmen under section 46 of the Factories Act, 1948, which provides for making rules by the State Government requiring that in any specified factory wherein m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dering service as a welfare measure under the Factories Act and the Rules. Consequently, the substance of the transaction in canteen sales, evidenced by its dominant object, is not sale of food, but rendering of services as a welfare activity as enjoined by the Factory Act and the State Rules. The fixation of price of food articles supplied by the canteen on non-profit basis as required under rule 80 of the M.P. Factories Rules is in conformity with the dominant object of service and welfare and excludes the intention of sale of food as business activity. 6.. In view of the discussion aforesaid we are of the opinion that in the facts and circumstances of the case the Tribunal was justified in holding that canteen sales are not exigible to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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