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TMI Blog1978 (12) TMI 157X X X X Extracts X X X X X X X X Extracts X X X X ..... ociation, Ernakulam, for the interveners. Dr. Y.S. Chitale, Senior Advocate (Lalit Bhasin, Vinay Bhasin and Vineet Kumar, Advocates, with him), for the Hotel Restaurant Association, Calcutta and Eastern Region, South Region Fariyas Hotel, for the interveners. V.J. Francis, Advocate, for the State of Kerala, for the interveners. Soli J. Sorabjee, Additional Solicitor-General (G.S. Chatterjee, Advocate, with him), for the State of West Bengal, for the interveners. S.T. Desai, Senior Advocate (M.N. Shroff, Advocate, with him), for the State of Gujarat, for the interveners. T.V.S.N. Chari and M.S. Ganesh, Advocates, for the State of Andhra Pradesh, for the interveners. A.V. Rangam, Advocate, for the State of Tamil Nadu, for the interveners. Soli J. Sorabjee, Additional Solicitor-General (M.N. Shroff, Advocate, with him), for the State of Maharashtra, for the interveners. S.K. Gambhir, Advocate, for the State of Madhya Pradesh, for the interveners. F.S. Nariman, Senior Advocate (Lalit Bhasin, M.N. Karkhanis, Mrs. S. Bhandare and Miss Malini Poduval, Advocates, with him), for the opposite party. M.C. Bhandare, Senior Advocate, f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry were provided, and there was also music, dancing and perhaps a floor show. Mr. Soli J. Sorabjee, the learned Additional Solicitor-General, who has been briefed by the respondent to appear at this stage in the case has, with his usual thoroughness and ability, succeeded in putting together a mass of legal material which we greatly wish had been before the Court when the appeals were originally heard. On the basis of that material, he submits that the judgment delivered by this Court ought to be reviewed. We have no hesitation in saying that had this material been available earlier, it would have enabled the Court to consider still further aspects of the problem and examine it more comprehensively. But, having regard to the basis on which the appeals proceeded, we are unable to say that the result would necessarily have been different. The learned Additional Solicitor-General contended that the judgment of this Court is amenable to review because, he says, it proceeds on the erroneous assumption that a restaurant can, for the purposes of the point of law decided by us, be likened to an inn. We have been referred to Halsbury's Laws of England 21 Hals. 3rd Edn. 441 at 442., and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made out and that, in any event, the judgment of this Court does not suffer from error. He pointed out that the decisions based on the Massachusetts-New York rule holding that the service of meals to customers in a restaurant constitutes a sale of food turned on the need for importing an implied warranty that the food was fit for eating. That consideration, it was said, need not influence the courts in India because the lacuna had been filled by law such as the Food Adulteration Act aimed at ensuring the supply of wholesome food to consumers. The submission is that whether the service of meals is or is not a sale must be determined by the nature of the transaction and not by the need to import an implied warranty of fitness. In other words, it is said, the factor of implied warranty must follow on the transaction being a sale and not that the transaction is a sale because an implied warranty is a necessary guarantee for public health. We are reminded that the true basis of our judgment is that no title in the food passes to the consumer as is evidenced by the circumstance that the unconsumed portion of the food cannot be carried away by him. It is pointed out that there never was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : Chandra Kanta v. Sheik Habib[1975] 3 S.C.R. 933. Now, besides the fact that most of the legal material so assiduously collected and placed before us by the learned Additional Solicitor-General, who has now been entrusted to appear for the respondent, was never brought to our attention when the appeals were heard, we may also examine whether the judgment suffers from an error apparent on the face of the record. Such an error exists if of two or more views canvassed on the point it is possible to hold that the controversy can be said to admit of only one of them. If the view adopted by the court in the original judgment is a possible view having regard to what the record states, it is difficult to hold that there is an error apparent on the face of the record. What were the considerations on which this Court held that the transaction was not a sale? The court said, and this was emphasised in no small degree, that the supply and service of food to a customer to be eaten in the restaurant was not a sale for the reason that he was merely entitled to eat the food served to him and not to remove and carry away the unconsumed portion of the food. Had that amounted to a sale, the unco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ire into the truth of the facts so asserted. It is in that factual context that this Court examined the question whether any liability to sales tax was attracted. Our judgment rests on that factual foundation, and must be understood in that light. It appears from the submissions now made that the respondent as well as other States are apprehensive that the benefit of the judgment of this Court will be invoked by restaurant-owners in those cases also where there is a sale of food and title passes to the customers. It seems to us that having regard to the facts upon which our judgment rests-undisputed as they have remained throughout the different stages of the litigation-and the considerations which they attract, no such apprehension can be reasonably entertained. Indeed, we have no hesitation in saying that where 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 services 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 maki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issect the items or decode the bill to discover separately the component of goods sold. This situation may obtain even in India with the throng of foreign tourists who want to be taken care of and pay all-inclusively. This may happen in some fashionable restaurants where you cannot, as of right, remove from the table what is left over. In these cases the decision under review squarely applies. My learned brother has clarified and confined the ratio to the contours so set out. He has also pointed out that counsel, at the earlier hearing, did not contest this factual matrix. A review in counsel's mentation cannot repair the verdict once given. So the law laid down must rest in peace. The learned Solicitor-General took us through English and American legal literature of vintage value and alien milieu. They enlightened us but did not apply fully, as explained by my learned brother. Had they been earlier cited, (sic) had been seriously considered. But India is India. It lives in its one lakh villages, thousands of towns, millions of pavement pedlars and wayside victuallers, corner coffee shops and tea-stalls, eating-houses and restaurants and some topnotch parlours. Habits vary, conve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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