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TMI Blog1988 (2) TMI 441X X X X Extracts X X X X X X X X Extracts X X X X ..... he Supreme Court in Northern India Caterers' case [1978] 42 STC 386. Accordingly, the petitioner stopped filing returns for the subsequent periods. The Sales Tax Officer, however, issued notice to the petitioner under sections 12(2) and 12(4) of the Act and completed assessment for the years 1977-78 and 1978-79 by raising demands of Rs. 8,655 and Rs. 9,082.50 respectively under the Act and Rs. 259.65 and Rs. 272.49 respectively under the O.A.S.T. Rules (as per annexure 2 series to each of the writ applications). Some penalties were also imposed by him for non-filing of the returns vide his orders in annexure 1 series to each of the writ applications. O.J.C. No. 1631 of 1980 relates to the assessment year 1977-78 and O.J.C. No. 1632 of 1980 relates to 1978-79. The petitioner has challenged the assessment orders on the ground that they were contrary to the principles laid down by the Supreme Court in the aforesaid authority. 4.. It would appear from the assessment orders that spot inquiries were made by the officers of the Revenue in the afternoon of 15th May, 1980 and 17th May, 1980 incognito. They took their tiffin in the restaurant and also purchased certain eatables (biri badas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... received guests to whom besides furnishing lodging, they also served various amenities, including meals, and the bill tendered to the guest was all-inclusive, i.e., a fixed amount for the stay in the hotel and all other amenities. To the question as to whether the company was liable to pay sales tax under the Punjab General Sales Tax Act, 1948 in respect of the meals served to the guests in the hotel coming for stay, it was held that the transaction was essentially one and indivisible, namely, one of receiving a customer in the hotel to stay. It was essentially one of service by the hotelier in the performance of which, and as part of the amenities incidental to the service, the hotelier served meals at stated hours. The Revenue, therefore, was not entitled to split up the transaction into two parts, one of service and the other of sale of foodstuffs and also to split up the bills charged by the hotelier as consisting of charges both for lodging and foodstuffs served to him, with a view to bring the latter under the Act. Again, in the Northern India Caterers' case [1978] 42 STC 386, the Supreme Court approved its earlier view and further held that there was no distinction betwee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payment or other valuable consideration, * * * Section 6(2) of the amending Act also contains a provision for exemption in these words: "Notwithstanding anything contained in sub-section (1), any supply of the nature referred to therein shall be exempt from the aforesaid tax(a) where such supply has been made, by any restaurant or eatinghouse (by whatever name called), at any time on or after the 7th day of September, 1978 and before the commencement of this Act and the aforesaid tax has not been collected on such supply on the ground that no such tax could have been levied or collected at that time; or (b) where such supply, not being any such supply by any restaurant or eating-house (by whatever name called), has been made at any time on or after the 4th day of January, 1972, and before the commencement of this Act and the aforesaid tax has not been collected on such supply on the ground that no such tax could have been levied or collected at that time: Provided that the burden of proving that the aforesaid tax was not collected on any supply of the nature referred to in clause (a) or, as the case may be, clause (b), shall be on the person claiming the exemption under thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... article for human consumption or any drink (whether or not intoxicating), where such supply or service, is for cash, deferred payment or other valuable consideration; but does not include a mortgage, hypothecation, charge or pledge and the words 'buy' and 'purchase' shall be construed accordingly." The definition of "dealer" in section 2(c) was also amended subsequently by the Orissa Sales Tax (Amendment) Act, 1987. Section 2(c)(ix) of the amended Act, which is in the line of sub-clause (vi) of "sale" is as follows: "a person who supplies by way of or as part of any service or in any other manner, goods, being food or any other article for human consumption or any drink (whether or not intoxicant), whether such supply or service is for cash, deferred payment or other valuable consideration." Both these amending provisions having been simply "substituted", must be deemed to be obviously prospective. The non obstante saving provision under section 6 of the Constitution (Forty-sixth Amendment) Act purports to validate the imposition or the authority to impose sales tax even before the commencement of the amendment under any State law on the ground of legislative incompetence and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate December, 1979, the legal position must be deemed to be there in existence all through, particularly when the Associated Hotels [1972] 29 STC 474 (SC); AIR 1972 SC 1131 and the Northern India Caterers [1978] 42 STC 386 (SC) cases were of star hotels primarily concerned with providing lodging to their customers. We have seen that on verification made by some officers of the Revenue, they had noticed that the petitioner was also selling eatables for human consumption outside the restaurant. Obviously, for such transactions and sales, by any stretch of imagination, the petitioner cannot claim any protection either from observations made in any decision or the constitutional amendment. The saving clause will give the petitioner exemption with respect to the sales to the customers consuming eatables in the restaurant itself. 12.. I would accordingly hold that the petitioner cannot escape its liability to pay sales tax for sales to the customers which were meant for consumption outside the restaurant. But at the same time it would not be liable for the sale and supply of eatable materials to its customers in the premises of the restaurant itself. The petitioner has thus made out ..... X X X X Extracts X X X X X X X X Extracts X X X X
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