9911796707
TMI Blog2001 (8) TMI 1361X X X X Extracts X X X X X X X X Extracts X X X X ..... ,62,570 by adding 10 per cent of the conceded turnover. For the year 1989-90, the petitioner conceded a taxable turnover of Rs. 54,30,482.15. The accounts were rejected and the petitioner was assessed for a taxable turnover of Rs. 62,44,960 by adding 5 per cent to the conceded turnover. The reasons on the basis of which the accounts were rejected are as follows: "(1) Sales turnover conceded for 1988-89 is much less than that for the previous year even when there is increase in purchase of raw materials and stationery when compared to the purchase for 1987-88. No satisfactory explanation has been offered for the steep fall in turnover even when there is considerable increase in purchase of raw materials. (2) Monthly sales turnover returned h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s cannot be an indication of the corresponding increases in the volume of business........ 2. The comparison of the quantity of rice purchased monthly with the turnover of the corresponding month is bound to be misleading. The rice purchased every month may not be completely used in the same month. Without considering the stock at the close of the every month the comparison is bound to be incorrect.......... 3. It is not practicable to maintain daily stock register in this line of business. We maintained inventories for the opening and closing stock and from the value shown under different items the quantity could be worked out.......... 4. We submit that the charges collected for taking food in the A/C restaurant cannot form part of the tu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e are certain peculiarities in the business and strict accounting is difficult. He submitted that it may not be possible to maintain stock register so far as hotel business is concerned. It is further submitted that there is no allegation that there is no difference between the stock and the account and that the accounts are not supported by bills or vouchers. Learned counsel brought to our notice a division Bench decision of this Court reported in Arya Bhavan Hotel v. State of Kerala [1997] 104 STC 546; (1997) 5 KTR 98. Kamat, J. speaking for the Bench in that case held as follows: "We have to appreciate the situational peculiarities of hoteling activity to emphasize that very few items from the preparation could be understood to be away f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of rice and the turnover of cooked food. He submitted that it cannot be said that hoteliers are not be able to maintain a true account. 4.. There is no contention for the Department that the petitioner had suppressed anything. According to us, the contention of the Revenue cannot be accepted. For example, the assessing officer as well as the authorities have made much of purpose of rice and the turnover of cooked food. As rightly pointed out by the division Bench of this Court referred to supra (Arya Bhavan Hotel v. State of Kerala [1997] 104 STC 546), the items involved in the hotel are perishable and merely because there has been some discrepancies between the purchase of rice and the turnover of cooked food, it cannot be presumed tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er than by way of sale in the State. Here is a case where water is purchased for the purpose of hotel. A similar question arose in the decision reported in Deputy Commissioner of Sales Tax (Law), Board of Revenue (Taxes), Ernakulam v. Thomas Stephen Co. Ltd. [1988] 69 STC 320 (SC). There the meaning of "consumption" and "disposing of" was discussed. The court held as follows: "........since the cashew shells had been used only as fuel and did not get transformed into the end-product and were not used as raw material in the manufacture of other goods, they did not fall within section 5A(1)(a) of the Kerala General Sales Tax Act and did not attract the tax payable. The same was the position regarding the lime shells and the consumed stores ..... X X X X Extracts X X X X X X X X Extracts X X X X
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