STATE OF MADRAS Vs. SPENCER AND COMPANY LIMITED

JUDGEMENT

(1.) M/s. Spencer and Company Limited, the respondents herein, are running two catering establishments, namely, Connemara Hotel at Madras and savoy Hotel at Ootacamund, in addition to the business as general merchants, tea estate owners, manufacturers of aerated water, drugs, etc. For the assessment years 1958-59, 1960-61, 1961-62, 1962-63 and 1963-64 the assessee-respondents submitted the returns under the Madras General Sales Tax act, 1939, and the Tamil Nadu General Sales Tax Act, 1959. In respect of the turnover relating to the two hotels they had adopted 50 per cent of the total receipts under apartment and board as representing sales of articles of food and drinks and returned the following amounts as taxable turnovers in respect of each of the years treating the same as sale value of food and drinks : 1958-59. . . Rs. 4, 44, 541. 87 at 2 1/2 per cent 1959-60. . . Rs. 3, 20, 382. 61 at 2 1/2 per cent 1960-61. . . Rs. 5, 65, 770. 30 at 2 per cent 1961-62. . . Rs. 6, 08, 412. 48 at 2 per cent 1962-63. . . Rs. 2, 52, 548. 00 at 2 per cent 1963-64. . . Rs. 1, 08, 957. 82 at 2 per cent

(2.) IN calculating the 50 per cent of the receipts under apartment and board as representing sales of articles of food and drinks, the assessees had deducted a sum of Rs. 1, 43, 840 for the year 1958-59, Rs. 1, 67, 624 for the year 1960-61, Rs. 2, 22, 061 for 1961-62, Rs. 76, 934 for 1962-63 and Rs. 15, 390. 50 for 1963-64 from the total receipts of apartment and board as relating to charges for air-conditioning and telephone facilities provided in the rooms.