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TMI Blog2000 (11) TMI 1065X X X X Extracts X X X X X X X X Extracts X X X X ..... two grounds which were taken were firstly challenge to the Forty-sixth Amendment to the Constitution whereby definition of expression "sale of goods" was amended and the second ground taken was that on a correct interpretation of the Delhi Sales Tax Act, 1975, the sales made in the restaurants could not be taxed. 3.. Mr. Gopal Subramanium, learned Senior Counsel for the appellants, has not argued or urged the first contention with relation to the challenge to the Forty-sixth Amendment. His contention is that on a correct interpretation of the provisions of the Delhi Sales Tax Act, 1975 and section 2(1) in particular, there is no sale in a restaurant in a hotel and, therefore, no sales tax could be levied. He submits that after the Forty- sixth Amendment it was open to the Legislature to amend the law and bring it in line with the said amendment to the Constitution which permitted such transactions being subjected to sales tax where food is supplied in a restaurant. Relying upon the decision of this Court in Northern India Caterers (India) Ltd. v. Lt. Governor of Delhi [1978] 42 STC 386; (1978) 4 SCC 36, he contends that meals which are served by a hotel in a restaurant to non-res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (i) the Central Government or a State Government carrying on such business; (ii) an incorporated society (including a co-operative society), club or association which sells or supplies goods, whether or not in the course of business, to its members for cash or for deferred payment or for commission, remuneration or other valuable consideration; (iii) a manager, factor, broker, commission agent, del credere agent, or any mercantile agent, by whatever name called, and whether of the same description as hereinbefore mentioned or not, who sells goods belonging to any principal whether disclosed or not; and (iv) an auctioneer who sells or auctions goods belonging to any principal, whether disclosed or not and whether the offer of the intending purchaser is accepted by him or by the principal or a nominee of the principal;" "2(g) 'goods' includes all materials, articles, commodities and all other kinds of movable property, but does not include newspapers, actionable claims, stocks, shares, securities or money;" "2(l) 'sale', with its grammatical variations and cognate expressions, means any transfer of property in goods by one person to another for cash or for deferred payment or fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be made retrospectively if it would have the effect of prejudicially affecting the interests of any dealer: Provided also that in respect of any goods or class of goods if the Lieutenant Governor is of opinion that it is expedient in the interest of the general public so to do, he may, and by notification in the official gazette, direct that the tax in respect of taxable turnover of such goods or class of goods shall, subject to such conditions as may be specified, be levied at such modified rate not exceeding the rate applicable under this section, as may be specified in the notification. (2) For the purposes of this Act, 'taxable turnover' means that part of a dealer's turnover during the prescribed period in any year which remains after deducting therefrom,- (a) his turnover during that period on- (i) sale of goods, the point of sale at which such goods shall be taxable is specified by the Lieutenant Governor under section 5 and in respect of which due tax is shown to the satisfaction of the Commissioner to have been paid; (ii) sale of goods declared tax-free under section 7; (iii) sale of goods not liable to tax under section 8; (iv) sale of goods which are proved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r to whom the goods are sold and containing the prescribed particulars in the prescribed form obtainable from the pre- scribed authority is furnished in the prescribed manner and within the prescribed time, by the dealer who sells the goods: Provided also that where any goods are purchased by a registered dealer for any of the purposes mentioned in sub-clause (v), but are not so utilised by him, the price of the goods so purchased shall be allowed to be deducted from the turnover of the selling dealer but shall be included in the taxable turnover of the purchasing dealer; and (b) the tax collected by the dealer under this Act as such and shown separately in cash memoranda or bills, as the case may be." 9.. From a reading of section 2(e), it is clear that, though it is an inclusive definition and not an exhaustive one, even in case of the supplies made by a club or an association to its members, whether or not in the course of business, the club or association is regarded as a dealer. According to section 2(g), all movable properties, materials, articles or commodities are goods. Therefore, food in a restaurant has necessarily to be regarded as goods. According to section 2(l), t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sale, since there is no intention to sell and purchase." 11.. In Associated Hotels' case [1972] 29 STC 474; (1972) 1 SCC 472, this Court was dealing with a situation where the hotel was receiving guests and providing them with all the amenities along with food and the bill which was tendered to the guests was all inclusive. In other words, whether the customer staying at the hotel consumed the food supplied to it or not, made no difference and the composite price or amount had to be paid by him. The court made it clear that it was not dealing with a case where food was being supplied by a restaurant to a customer against payment of various items of food which he consumed but the court was concerned with a situation where a composite amount was being charged by the hotel supplying all the facilities including food in a restaurant. The observations of the Constitution Bench in Associated Hotels' case [1972] 29 STC 474 (SC); (1972) 1 SCC 472 referred to hereinabove clearly show that property in food-stuff passes from the hotelier to the customer at least to the extent of food-stuff consumed. Section 2(1) clearly provides that sale would mean any transfer of property in goods by one p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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