2006 (7) TMI 585 - HC - VAT and Sales Tax

Summary

Issues:
Determining whether ice-cream served in a petitioner's ice-cream parlour qualifies as cooked food exempt from sales tax under the Kerala General Sales Tax Act, 1963.

Analysis:
The primary issue in this case revolves around whether ice-cream can be classified as "cooked food" for the purpose of exemption under the Kerala General Sales Tax Act, 1963. The petitioner contends that the process of making ice-cream involves heating, which aligns with the definition of "cook" as preparing food by heating. However, the Appellate Assistant Commissioner and the Tribunal have ruled that ice-cream does not fall under the category of cooked food. The Tribunal emphasized that ice-cream is considered a refreshment rather than an item intended to quench hunger, which is a key distinction in this context. The petitioner also relied on the definition of "cook" from the Concise Oxford Dictionary to support their argument.

The petitioner further presented the process of making ice-cream, highlighting the heating involved in pasteurization and other stages. Despite acknowledging the heating process, the court deemed it insufficient to categorize ice-cream as cooked food. Drawing parallels, the court referenced a previous case involving biscuits, where the Supreme Court clarified that certain items, although involving heating, may not be considered cooked food in ordinary parlance. This distinction is crucial in determining the applicability of the exemption under the sales tax law.

Moreover, the court examined precedents such as the State of Andhra Pradesh v. Ajanta Cool Drinks, emphasizing the interpretation of terms like "restaurant" and "cooked food" in the context of tax exemptions. The court also referenced the decision in Philips Smith v. Additional Sales Tax Officer to underline the criteria for claiming exemption based on the immediate consumption of cooked food. These references served to provide a broader legal framework for evaluating the petitioner's arguments in the present case.

Ultimately, the court upheld the Tribunal's decision, emphasizing that while heating is involved in the ice-cream making process, the final product's properties and market perception do not align with the popular understanding of cooked food. Therefore, the court dismissed the revision petitions, affirming that ice-cream does not qualify as cooked food for the purposes of the sales tax exemption under the Kerala General Sales Tax Act, 1963.