STATE OF TAMIL NADU Vs. METTUR BEARDSELL LIMITED

JUDGEMENT

(1.) THIS tax-revision case has been filed by the Revenue u/s. 38 of the Tamil Nadu General Sales Tax Act against the order dated 8-10-1974 of the Sales Tax appellate Tribunal Madras made in T.A. No. 522 of 1974.

(2.) THE assessee, a public limited company is a dealer in air-conditioner, chemicals etc., having its Head Office at Madras and a Branch Office at Coimbatore. THE assessee undertakes even the erection of air-conditioning plants, thermocole false ceiling, on work contract basis. For the assessment year 1969-70, the assessee returned in Form A-2 a total turnover of Rs. 4, 87, 23, 733.10 and Rs. 35, 41, 653.80 respectively for its Head Office and Branch Office, claiming exemption under various heads on a turnover of 4, 51, 82, 079.30. After a final check of accounts, the Assessing Officer proposed to allow exemption on a turnover of Rs. 4, 33, 92, 691.69 in respect of the Head Office and Rs. 17, 85, 165.32 in respect of the Branch Office, totalling Rs. 4, 51, 77, 857, 01 and ascertained the proposed taxable turnover at Rs. 35, 65, 984.08 for both the Head Office and the Branch Office. After considering the assessee's objections the Assessing Officer allowed exemption on a turnover of Rs. 4, 33, 92, 691.69 in respect of the Head Office and Rs. 18, 17, 940.46 in respect of the Branch Office, totalling Rs. 4, 52, 10, 632.15 and determined the taxable turnover in respect of both the Head Office and the Branch Office at Rs. 35, 33, 208.94. Subsequently the Assessing Officer notived that sales turnover to the extent of Rs. 1, 51, 727.00 inclusive of canteen sales turnover of Rs. 1, 09, 619.00 had escaped assessment and he proposed to levy tax thereon at 3 per cent and issued the necessary notice calling upon the assessee to file its objections. THE Assessing Officer considered the assessee's objection and confirmed his proposal to levy tax at 3 per cent of the canteen sales of Rs. 1, 09, 619.00 under S. 16 of the Tamil Nadu General Sales Tax Act on the ground that the assessee had not proved that it had subsidised 25 per cent of the total expenses of running the canteen and issued a demand notice.

(3.) IN the assessee's further appeal to the Tribunal it was contended that even during the original assessment the turnover relating to canteen sales was noticed and excluded by the Assessing Officer and that there was no escape of turnover for resorting to re-assessment under S. 16 of the Act. The Tribunal rejected that contention and held that the Assessing Officer had jurisdiction under S. 16 to levy tax on the turnover which had originally escaped assessment. On the order question of the assessee being entitled to exemption on the canteen sales, the Tribunal purported to follow the decision of this Court in The INdia Cements Employees Canteen vs. D.C.T.O. Tirunelveli Junction, and held that in case of canteens run by the employer himself, as in the present case, the question of subsidising to the extent of 25 per cent of the total expenses incurred in the normal running to the canteen does not arise and allowed the appeal as regards the canteen turnover of Rs. 1, 09, 619.00.