TMI Blog2023 (6) TMI 842X X X X Extracts X X X X X X X X Extracts X X X X ..... was of supply of entertainment/service is also untenable - the questions of law framed hereinabove have to be answered in favour of the revenue and against the assessee - Accordingly, the impugned order of the Tax Board is quashed and set aside and the levy of penalty is maintained. - S.B. Sales Tax Revision / Reference No. 63/2020, 64/2020, 72/2020, 73/2020, 74/2020, 75/2020, 76/2020 And 77/2020 - - - Dated:- 2-6-2023 - Hon'ble Mr. Justice Sameer Jain For the Petitioner(s) : Mr. Punit Singhvi with Mr. Ayush Singh, Adv. For the Respondent(s) : Mr. Mahendra Gargeiya with Mr. Devang Gargeiya, Mr. Aurnabh Dey, Adv. JUDGMENT 1. The present Sales Tax Revisions/References (for short STRs ) have been filed by the revenue, under Section 84 of the Rajasthan Value Added Tax Act, 2003 (for short RVAT Act ) read with Section 86 of the Rajasthan Sales Tax Act, 1994 (for short RST Act ), assailing the impugned order dated 23.18.2019 passed by the Rajasthan Tax Board, Ajmer and involves the following question of law: i) Whether in the facts and circumstances of the case the Rajasthan Tax Board was justified in law in holding that the expenses charged are separat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adults and Rs. 175 for children) and that the assessee cannot split up the amount charged for sale of food, even if the assessee provides certain services in addition to food as VAT has to be paid on total amount charged. 5. Learned counsel for the revenue has also emphasized the fact that the assessee was not issuing invoices to the customers in the regular course of business and only issued the invoices when the customer specifically demanded it. 6. Learned counsel for the revenue has relied upon Apex Court judgments of K. Damodarasamy Naidu and Bros. and Ors. vs. The State of Tamil Nadu and Ors.: (2000) 1 SCC 521 and Idea Mobile Communication Ltd. vs. C.C.E. and C., Cochin: (2011) 12 SCC 608 in support of his contention that VAT is payable on total amount charged for food, even if some bundled services, like recreational activities, music and dance shows etc., are provided along with food. 7. Per contra , learned counsel for the assessee submits that the entire case of the revenue proceeds on a wrong factual premise that the coupons were issued in lieu of invoice. The coupons were issued merely for administrative convenience of the assessee and the assessee was al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r is not allowed to pay and enter just for food or just for entertainment, which clearly implies that customer is paying towards food as also towards entertainment separately. 10. Learned counsel for the assessee has also relied upon Apex Court judgment of Bharat Sanchar Nigam Ltd. and Ors. vs. Union of India (UOI) and Ors.:(2006) 3 SCC 1 . Learned counsel further submits that the judgment of K. Damodarasamy Naidu and Bros. (supra) , relied upon by learned counsel for the revenue, is distinguishable as that case was pertaining to mutant sale under Article 366(29A) of Constitution of India to supply food and drinks in hospital, whereas in the present case, dominant intention is to provide entertainment with which food is also provided, but the same are being charged separately through invoices. The said case was also distinguished by this Court in Assistant Commissioner, Anti Evasion, Kota and Ors. vs. Kota Eye Hospital And Research Foundation and Ors. (D.B. STR No. 139/2019; decided on 25.08.2022; Neutral Citation: 2022/RJJP/002174). 11. Heard the arguments advanced by both the sides, scanned the record of the STR and considered the judgments cited at Bar. 12. In the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or in some other form) involved in the execution of a works contract; (iii) any delivery of goods on hire-purchase or other system of payment by instalments; (iv) a transfer of the right to use goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; (v) a supply of goods by an unincorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration; and (vi) a supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (whether or not intoxicating), where such supply is for cash, deferred payment or other valuable consideration, and such transfer, delivery or supply shall be deemed to be a sale and the word purchase or buy shall be construed accordingly; Explanation:- Notwithstanding anything contained in this Act, where any goods are sold in packing, the packing material in such case shall be deemed to have been sold with the goods; Section 2(36) sale price means the amount paid or payable to a dealer as consideration for the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l that the customer paid in the restaurant had, therefore, to be spilt up between what was charged for such service and what was charged for the food. 9. The provisions of Sub-clause (f) of Clause (29A) of Article 366 need to be analysed. Sub-clause (f) permits the States to impose a tax on the supply of food and drink. The supply can be by way of a service or as part of a service or it can be in any other manner whatsoever. The supply or service can be for cash or deferred payment or other valuable consideration. The words of Sub-clause (i) have found place in the Sales Tax Acts of most States and, as we have seen, they have been used in the said Tamil Nadu Act. The tax, therefore, is on the supply of food or drink and it is not of relevance that the supply is by way of a service or as part of a service. In our view, therefore, the price that the customer pays for the supply of food in a restaurant cannot be split up as suggested by learned Counsel. The supply of food by the restaurant owner to the customer, though it may be a part of the service that he renders by providing good furniture, furnishing and fixtures, linen, crockery and cutlery, music, a dance floor and a floo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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