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TMI Blog1980 (8) TMI 174X X X X Extracts X X X X X X X X Extracts X X X X ..... o. 757 (T) of 1973 - - - Dated:- 1-8-1980 - BHAGWATI P.N., SEN A.P. AND VENKATARAMIAH E.S. JJ. -------------------------------------------------- The judgment of the Court was delivered by BHAGWATI, J.- The only question which arises for consideration in this appeal by certificate is whether sales of provisions effected by the assessee in a workmen's store maintained by it are assessable to tax under the Tamil Nadu General Sales Tax Act, 1959. The assessee carries on business of manufacture and sale of textiles in a factory situate in the State of Tamil Nadu. It is one of the leading manufacturers of textiles in the country. It is running a store in the premises of the factory where workmen can buy provisions. In the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 (SC). The view taken by the High Court in Thirumugal Mills case [1967] 20 STC 287 was that sales effected in a fair price shop maintained by the assessee were not taxable even after the amendment made in the Tamil Nadu General Sales Tax Act, 1959, with effect from 1st September, 1964, because the activity carried on in the fair price shop was not of a commercial nature and did not partake of the character of business. This view did not find favour with the court in the Burmah Shell case [1973] 31 STC 426 (SC) and in the judgment delivered in that case Jaganmohan Reddy, J., speaking on behalf of the court, pointed out that the view taken in the Thirumagal Mills case [1967] 20 STC 287 did not take into account the word "such" in clause (ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng within clause (i), any transaction in connection with or incidental or ancillary to such trade, commerce, manufacture, adventure or concern, would constitute "business" within the meaning of clause (ii) even though the transaction by itself may not have the characteristics of business as understood in ordinary parlance. Now, the business which was carried on by the assessee was manufacture of textiles and the transaction of sale of provisions in the store were, in the submission of Mr. S. T. Desai, appearing on behalf of the State, in connection with or incidental to such business. This contention was seriously disputed by Mr. Ramachandran on behalf of the assessee and he urged that there was no connection between the activity of manufac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ains to something else as primary. Surely, such work should not be extraneous or contrary to the purpose of the establishment but need not be integral to it either". Applying this test the court held that it was impossible to contend that "a canteen or cycle stand or cinema magazine booth is not even incidental to the purpose of the theatre. The cinema goers ordinarily find such work an advantage, a facility, an amenity and, some times, a necessity. All that the statute requires is that the work should not be irrelevant to the purpose of the establishment". Now, if a canteen maintained by a cinema owner for the benefit of cinema goers can be regarded as incidental to the purpose of the cinema theatre which is to carry on the business of exh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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