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TMI Blog2014 (4) TMI 367X X X X Extracts X X X X X X X X Extracts X X X X ..... ctly to the consumer - As it is stated in the letter addressed to the Special Commissioner, all that the assessee did was collecting the voucher from the cash counter of M/s.Food World Super Market Limited and thus based on the payment made by the customer to M/s.Food World Super Market Limited, the assessee merely supplied the food products to the ultimate consumer - So, the materials placed before clearly pointed out that it was an outright sale by the assessee to M/s.Food World Super Market Limited and this was not "sale" by the assessee to the ultimate consumer in the retail place, and above all in a eating house to attract Section 3-D of the TNGST Act, 1959. Rate of Tax – Classification - Food items – Items under Brand name - Name not being registered - Liability u/s 3(2) of the TNGST Act, 1959 r/w Serial No.4 (iii) of Part E of the First Schedule to TNGST Act - Held that:- The reading of the Entry in Part E of First Schedule, any food item or a preparation sold under the brand name, whether or not registered under the Trade and Merchandise Mark Act, would fall for consideration under the said entry – What was sold by the assessee in the retail outlet to M/s.Food World Supe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of food items effected by the petitioners was taxable under Section 3(2) of the Tamil Nadu General Sales Tax Act, 1959 read with Serial No.4(iii) of Part E of the First Schedule to the TNGST Act instead of Section 3-D of that Act? 2. Whether the finding of the Hon'ble Tribunal that the petitioners had sold branded food items is perverse and vitiated by taking into account irrelevant facts and the omission to take into account relevant facts on record before it ? 2. The assessee herein is a manufacturer and dealer in food preparation. It is stated that the assessee has a kitchen facility at Ambattur Industrial Estate, where, they prepared raw puffs, freeze them and transports the same to the premises of M/s.Food World Super Market Limited. 3. It is stated that the raw puffs were stored in its own freezer and whenever the customers approached M/s.Food World Super Market Limited, the frozen puffs were fried and delivered. Considering the doubt as to the rate of tax applicable to the puffs sold as well as certain other bakery products, the assessee sought for clarification under Section 28-A of the Tamil Nadu General Sales Tax Act, 1959 before the Special Commissioner, Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve produced a certificate from M/s.Food World Super Market Limited as to the nature of transaction done by the assessee; that the assessee fried and sold various types of curry puffs from 31st March 2002; the assessee stored the frozen curry puffs in their own freezer; the assessee had its own display cabinets and fryer at the outlets; their own staff did the process of frying their curry puffs in oil using their own fryer and served on their own paper plate, napkins and sauce for consumption by the customer at the outlet. In continuation of the certificate issued dated 25.08.2004, M/s.Food World Super Market Limited by letter dated 15th June, 2005 pointed out that the assessee supplied unbranded curry puffs in their outlets. 7. After receipt of the notice, the assessee objected to the proposal stating that the puffs were sold not under brand name and 99% of the sales were for consumption in the premises of M/s.Food World Super Market Limited; the invoice raised on M/s.Food World Super Market Limited would bear testimony to the fact that the sale by the assessee were only unbranded puffs; consequently, the assessee contended that the turnover being less than 25 lakhs, the benefi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urnover after taking into consideration the purchase turnover and levy 2% tax if the total turnover exceeded Rs.25 lakhs. Thus, he remitted the matter back to the Assessing Officer. As far as assessment years 1999-2000 and 2000-01 was concerned, the assessments were set aside and remanded back to the Assessing Officer to levy tax under Section 3-D of the Tamil Nadu General Sales Tax Act, 1959. Aggrieved by this, the Revenue went on appeal before the Sales Tax Appellate Tribunal. 12. The Sales Tax Appellate Tribunal pointed out that the assessee had prepared vegetable and chicken puffs and other food items under the name Old Chang Kee and their registered place is at Ambattur Industrial Estate and no details of the retail outlets were furnished by the assessee. The food products were sold entirely to M/s.Food World Super Market Limited and not directly to the ultimate consumers; that the food items were served immediately after frying to the customers who consumed the same at the retail outlets of M/s.Food World Super Market Limited. 13. Going through Section 3-D of the Tamil Nadu General Sales Tax Act, as it existed prior to 01.04.2002, when the products were sold by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpression any other eating house as appear in Section 3-D(1) of the Tamil Nadu General Sales Tax Act; consequently, the rate of tax that the assessee would have to pay has to be in consonance with Section 3D(1) and the rate specified under Part A of the Ninth Schedule of the Tamil Nadu General Sales Tax Act. 18. He further took us through Part-C, Entry 12 Sub-clause (iii) relating to the food including preparations of vegetables, fruits, milk, cereals, flour (other than bread and bakery products) starch, birds-eggs, meat offals, animal blood, fish crustaceans and molluses sold without brand name attracting 8% and Part E Entry 4 dealing with food attracting rate at 16% and submitted that except for using the letter-head, which is a house name, there is hardly any material to show that the products sold by the assessee carried brand name. He submitted that the assessee prepared raw puff, their staff fried in the outlet in the Food World Super Market Limited and sold to the consumers therein and going by the product and that the Commissioner had drawn a wrong conclusion based on the letter-head alone; the item in question being unbranded, the same would attract 8% and not 16% as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Special Commissioner and Commissioner of Commercial Taxes, stated that the consumer collected the voucher from the cash counter and surrendered the same at their counter, the staff at their counter prepared, dressed and supplied the food products. From the materials available, we hold that the fact that the sale had taken place in the premises of M/s.Food World Super Market Limited outlet does not mean that the sale was in a eating house to fall under Section 3-D of the Tamil Nadu General Sales Tax Act. 25. We do not find any justifiable ground to accept the submission of the assessee that the sale in the outlet would be a sale in the eating house for the reason that the assessee did not dispute the fact that it did not sell the puffs directly to the consumer; on the other hand, as already pointed out, the sale was directly only to M/s.Food World Super Market Limited, which provided the facility for the customer to eat the puff therein. The fact that the assessee had its frying unit therein, however, does not make the outlet as its eating house to sell puff directly to the consumer. As it is stated in the letter addressed to the Special Commissioner, all that the assessee did w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... name alone, hence, the Department committed serious error in stating that the item in question was sold under the brand name. Quite apart M/s.Food World Super Market Limited issued a certificate that the items sold were unbranded. As far as the reliance placed on certificate issued by M/s.Food World Super Market Limited is concerned, we do not find any justification to attach importance to the certificate, who are the purchasers from the assessee. 29. As far as the contention regarding the invoice or letter-head carrying name, hence, could not confer the items with any brand name is concerned, as is evident from the reading of the Entry in Part E of First Schedule, any food item or a preparation sold under the brand name, whether or not registered under the Trade and Merchandise Mark Act, would fall for consideration under the said entry. It is an admitted fact that what was sold by the assessee in the retail outlet to M/s.Food World Super Market Limited were of preparations, which had the mark of the assessee, which was a distinct one from what one would find otherwise in the case of food fried with stuff sold either in street or in any other outlet of a similar nature. The as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the brand name were sold. Thus, the place in which other goods sold would not be of relevance for the purpose of considering whether the item in question carried brand name. 32. As far as the decision (cited supra) relied on by the assessee is concerned, we do not find that the judgment would be of any assistance to the assessee herein for the reason that the decision rested on the wordings under Entry 103 of the I Schedule as it existed therein. 33. In the context of the facts available before this Court as stated in its representation before the Special Commissioner and as found by the Tribunal, we do not find any justifiable ground to extend the benefit of the judgment referred to reported in (2005) 141 STC 277 (Tamil Nadu Co-operative Milk Producers' Federation Ltd., Vs. State of Tamil Nadu and others) to the facts of this case. 34. Learned counsel for the assessee/revision petitioner submitted that the Authorities below had tacitly accepted the clarification issued by the Commissioner. 35. We may point out that the assessee, who went before the Special Commissioner seeking clarification, after receiving the clarification, left it at that stage itself. Howev ..... X X X X Extracts X X X X X X X X Extracts X X X X
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