9911796707
TMI Blog1976 (10) TMI 135X X X X Extracts X X X X X X X X Extracts X X X X ..... en the management and the employees under section 12(3) of the Industrial Disputes Act, 1947, it was agreed that the employees would not collect tips from the customers and instead the management would collect 5 per cent of the tariff value of the articles served as service charges and utilise the service charges so collected by way of paying 50 per cent thereof immediately to the employees and appropriating the other 50 per cent to increase the wages and food allowance of the employees and also to introduce a provident fund scheme for the employees, that, therefore, the service charges so collected do not stand on a footing different from the tips previously collected by the employees and that, consequently, the same cannot be included in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al purposes, the price of the food ordered by the customer is what he pays therefor. If the customer is required to pay what is stated as tariff plus 10 per cent over and above that tariff, then the price, so far as the customer is concerned, for the food supplied and served to him in the establishment will be the total amount of the bill that is charged including the so-called service charges. The Tribunal has also held that it is not possible for the customer to enter into the contract only for doing service in the manner in which the service charges are sought to be interpreted apart from the food which is supplied. It is not as if one can take one's food from outside and order it to be served in the hotel for which any charge will be pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ployed in the task with which the customer is not directly concerned at all. It will, therefore, be seen that what is charged as service charges and required to be paid by the customer is in effect an addition to the price which he has to pay and is properly to be considered as sale price of the food ordered by him in that establishment." If we may say so, with respect, we entirely agree with the above reasoning and conclusion of the Bombay High Court. In view of this, we are of the opinion that the conclusion of the Tribunal in this case in including the service charges in the taxable turnover of the assessee is correct. Hence the tax revision cases fail and they are dismissed. The respondent is entitled to its costs-counsel's fee Rs. 25 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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