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2017 (4) TMI 860

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..... lude within its purview, anything that is supplied at a subsidized rate - the food supplied by an employer to its employees at a subsidized rate forms part of the wages under Section 2(rr) of the Industrial Disputes Act, 1947. Once the State Authorities have treated the supply of food to the workers of the petitioner as sale, it is not open to the respondents to treat the same as service and impose a liability - petition allowed - decided in favor of petitioner. - WRIT PETITION No. 217 of 2017 - - - Dated:- 23-3-2017 - SRI V. RAMASUBRAMANIAN AND MS. J. UMA DEVI, JJ. For The petitioner : Dr. M.V.K. Murthy For The Respondent : Mr. B. Narayana Reddy, the Assistant Solicitor General ORDER: (Per VRS,J) Aggrieved by an or .....

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..... ty carried out by a person for another for consideration, and includes a declared service, but shall not include (a) an activity which constitutes merely (i) a transfer of title in goods or immovable property, by way of sale, gift or in any other manner; or (ii) such transfer, delivery or supply of any goods which is deemed to be a sale within the meaning of clause (29A) of article 366 of the Constitution; or (iii) a transaction in money or actionable claim; (b) a provision of service by an employee to the employer in the course of or in relation to his employment; (c) fees taken in any court or tribunal established under any law for the time being in force. It may be seen from the above definition that to come within the .....

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..... a person falls within the purview of the definition service, the question of analyzing whether such activity falls within the exemption under the Notification, dated 20.06.2012, does not arise. Therefore, primarily, one has to satisfy oneself as to whether the activity in question satisfies all the ingredients of service within the definition of the term under Section 65B (44). 9. The specific case of the petitioner, on which there is no dispute on facts, is that they supply food to their workers at a subsidized rate. Naturally, no management will be magnanimous enough to ask the workers to take the food sitting inside the air-conditioned dining hall. If the workers are provided food outside such a restaurant, which is meant exclusively .....

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..... or business. 11. Therefore, the food supplied by an employer to its employees at a subsidized rate forms part of the wages under Section 2(rr) of the Industrial Disputes Act, 1947. 12. Once the activity undertaken by the petitioner in the form of supply of food to its workers at a subsidized rate is understood to be part of their industrial obligation, it is unthinkable that the same can be construed as service falling within the definition of the expression service under Section 65B(44) of the Finance Act. The 2nd respondent has completely overlooked this aspect and assumed a jurisdiction not vested in him in law. As a matter of fact, the petitioner has paid the value added tax on the value of the food supplied to its workers. In res .....

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