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Tvl. Zaitoon Multi Cuisine Family Restaurant Versus The Assistant Commissioner (CT) , Thiruvanmiyur Assessment Circle, Chennai

2015 (12) TMI 240 - MADHYA PRADESH HIGH COURT

Assessment of turnover tax - petitioner got trade mark registration and the sale of branded food is taxable at 14.5% and since the petitioner paid 2% on the total taxable turnover - Held that:- provisions of the Trade Marks Act, 1999 as well as Rules thereof would apply to the petitioner. The Fourth Schedule of the Trade Marks Rules, 2002 envisages ‘Classification of Goods and Services-Name of the Classes”, wherein, though Item Nos.29 and 30 would refer to food items, however, they are not prepa .....

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he Act, the food items also are to be considered as ‘branded items’ and therefore, levy of tax on such branded food and drink items would be at 14.5% as prescribed under Section 7(1)(a) of the TNVAT Act, 2006 and the respondent has rightly passed the impugned assessment order.

It is brought to the notice of this Court that by mistake, the above said provision has been wrongly mentioned, however, in the notice, dated 3.12.2014, the respondent has mentioned that it was proposed to revis .....

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J. For petititoner : Mr. Joseph Prabakar For Respondent : Ms. Dr.Anita Sumanth, Spl.G.P. Asstd. By Mr.V.Haribabu, AGP (T) and Mr. AN.R.Jayapratap, AGP (T) ORDER The petitioner, Zaitoon Multi Cuisine Family Restaurant, is engaged in the business of running restaurant at Thiruvanmiyur, Chennai, registered with the respondent. The petitioner reported total and taxable turnover at ₹ 1,97,33,034/- for the period April 2014 to November 2014 and filed monthly returns and paid VAT 2% under Section .....

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strued only as a House mark (house name) and not as a product mark (brand name) and the name Zaitoon is not appearing in any of their products, but used only in the name boards. The petitioner applied for registration of restaurant, catering and restaurant outlet and therefore, the trademark referred to by the respondent is not for any food items prepared and served by the petitioner in their restaurant, but for the services provided by the restaurant as a whole. In other words, the registration .....

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d 2% on the total taxable turnover of ₹ 1,97,33,034/-, the Assessing Officer issued notice dated 3.12.2014 proposing to revise the assessment under Section 25(1) of TNVAT Act, 2006 for which, the petitioner filed their objections on 18.2.2014 stating that they had taken trade mark registration only for the name of the restaurant and not for the goods manufacturedand sold. According to the respondent, as the trade mark registration is meant for the restaurant as well as the products manufac .....

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e selling only branded food items taxable at 14.5% as per Section 7(1)(a) of TNVAT Act, 2006.The contention of the petitioner that Zaitoon must be construed as a house mark (house name) and not as a product mark (brand name), is not acceptable since the food items that are prepared and sold in the hotel which was having a house mark are synonymously bear the trade made on their products. Therefore, the food items sold by the petitioner are branded food taxable at 14.5%.The petitioner is a trade, .....

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liers.Hence, Zaitoon is the trade mark of their food items which can be said as branded food taxable at 14.5%.As against the impugned order, the petitioner is having remedy of filing revision petition before the Joint Commissioner concerned. However, without availing the said remedy, the petitioner has approached this Court by filing the present writ petition, which is not maintainable. Therefore, with these averments, the respondent sought for dismissal of the writ petition. 4. Heard the learne .....

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e on the prepared food and hence, the assessment of turnover at 14.5% treating the same as sale of branded food and drinks under Section 7(1) of TNVAT Act, 2006 by the respondent, is ex-facie illegal and arbitrary; ii) that the term Zaitoon has to be construed only as a House Mark (house name) and not as a produce mark (brand name) and it is used only in the name boards and no trade mark is provided on the package or on food items that are prepared and sold in the restaurant and hence, the food .....

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fic, but service specific and thus the selling food has to be considered as service under Service Tax law and the Trade Marks Act, 1999, which provides for registration of the mark or name for any service including services for providing food and drink and temporary accommodation and hence, mere applying for registration under the Trade Marks Act, 1999 by the petitioner, it would not mean that they are selling branded food. 6. With the above contentions, the learned counsel would submit that the .....

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e. 7. On the other hand, the learned counsel appearing for the respondent would contend that admittedly, the petitioner got registration under the Trade Marks Act and selling only branded food prepared by them which attracts tax at 14.5% as per the provisions of the TNVAT Act, 2006 and the respondent having served the pre-revisional notice, dated 3.12.2014 and after considering the objections filed by the petitioner on 18.12.2014, has passed the impugned order, which requires no interference and .....

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m 35 to 45 would refer services , which, as per the Act, they are trademark services and Item 43 specifically mentioned as Services for providing food and drink; temporary accommodation .Therefore, as rightly contended by the learned counsel for the respondent, the trade mark registration is meant for the restaurant as well as the products manufactured by it and when the activity of service for providing food and drink is considered as a trade mark under the Act, the food items also are to be co .....

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ks Act, 1999 (Central Act, 47 of 1999).Therefore, when the above definition applies to the present case, it is not in dispute that the petitioner restaurant is a registered under the provisions of the Trade Marks Act, 1999 and whatever food prepared and served would certainly fall under the definition branded as per Section 2(9) of the TNVAT Act 2006 and hence, this Court is unable to accept the contention of the petitioner that they got only registration towards restaurant and it has to be cons .....

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served to him. If the petitioner is serving the food items which are not prepared by it, the matter is altogether different and there would be no purpose in getting trade mark. Therefore, when the petitioner restaurant Zaitoon has got registration of trade mark for services providing by it, certainly, the food items prepared and served by them would fall within the definition of branded . 10. Section 7(1)(a) of the TNVAT Act, 2006 reads as under: Levy of taxes on food and drinks.-(1) Notwithstan .....

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The above said provision is a charging section in respect of in respect of sale of unbranded food and drinks by hotels, restaurants, caterers, sweet-stalls, etc.,By virtue of this section, the recognized star hotels shall pay tax at 14.5% of the taxable turnover.This section will not apply to branded foods and drinks for which tax rates have been specified in the first schedule.It is brought to the notice of this Court that by mistake, the above said provision has been wrongly mentioned, however .....

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