STATE OF KARNATAKA Vs. UDIPI KRISHNA BHAVAN

JUDGEMENT

(1.) These are two sales tax revision petitions presented under section 8A of the Karnataka Appellate Tribunal (Amendment) Act (59 of 1976) read with section 23 of the Karnataka Sales Tax Act, 1957 (hereinafter referred to as the Act).

(2.) The assessee in both the cases is Udipi Krishna Bhavan, Kolar. For the assessment years ending 31st March, 1977, and 31st March, 1976, the respondent was assessed to tax on the turnover of food and drinks supplied by it to the visitors. The turnover included similar transactions at M/s. Sweekar Hotel which is said to be a branch of the main hotel at Kolar. The respondent preferred two appeals before the Deputy Commissioner of Commercial Taxes who reduced the turnover to some extent. Aggrieved by the said orders of the appellate authority, the respondent preferred two second appeals before the Karnataka Appellate Tribunal. Before the Tribunal, the respondent placed reliance on the judgment of the Supreme Court in Northern India Caterers (India) Ltd. v. Lt. Governor of Delhi AIR1978 SC 1591 , (1978 )4 SCC36 , [1979 ]1 SCR557 , [1978 ]42 STC386 (SC ) in which the Supreme Court had held that supply of food-stuffs in a hotel or restaurant accompanied by service does not constitute sale as defined under section 2(g) of the Bengal Finance (Sales Tax) Act (6 of 1941) as in force in the Union Territory of Delhi. The Tribunal applied the ratio of the said judgment and held that the turnover of the respondent does not constitute the turnover under the Act. Aggrieved by the said common order of the Tribunal, the State has presented these two revision petitions.

(3.) Shri R. G. Devadar, the learned High Court Government Pleader, contended that in view of the observations of the Supreme Court in its judgment on the review petition filed in the case of Northern India Caterers AIR1980 SC 674 , (1980 )2 SCC167 , [1980 ]2 SCR650 , [1980 ]45 STC212 (SC ), 1980 (12 )UJ494 (SC ), it should be held that the ratio in the main judgment is in applicable to the case of the assessee and, therefore, the order of the Appellate Tribunal is liable to be set aside.