COMMISSIONER OF SALES TAX Vs. PUNJAB NATIONAL HOTEL

JUDGEMENT

(1.) THIS is a reference on the case stated by the sales Tax Tribunal under section 6 (1) of the Bombay Sales Tax Act, 1959 (referred to hereinafter as "the Bombay Sales Tax Act" ). The two questions which have been referred to us for our determination in this reference are as follows : " (i) Whether the Tribunal was justified in law in holding that the expression 'turnover of sales' as appearing in entry 9 of the notification issued under section 41 of the Bombay Sales Tax Act, 1959, and as operative in the period from 29th September, 1963, to 12th October, 1972, meant the turnover of taxable sales and not the turnover of all sales of all commodities effected by the dealer during the year under assessment ? (ii) Whether on a true and proper interpretation of the concluding part of entry 9 of the notification under section 41 of the Bombay Sales Tax Act, 1959, the Tribunal ought to have held that the respondent was not eligible to the benefit of that entry as he was not conducting an establishment primarily for the sales of sweetmeats ?"

(2.) THE facts giving rise to this reference are as follows : THE respondent is a registered dealer and conducts a hotel and a restaurant at Barsi, where vegetarian and non-vegetarian food is served to customers. In respect of the period from 18th October, 1963, to 4th November, 1964, the Sales Tax Officer concerned determined and gross turnover of sales of the respondent at Rs. 2,26,943. Out of this amount, sales to the extent of Rs. 2,15,923 were held to be exempt from tax by the Assistant Commissioner as being covered by the exemption granted under entry 14 of Schedule A to the Bombay Sales Tax Act. THE taxable sales of cooked food sold by the respondent during the relevant period thus came to the value of Rs. 11,029. In the second appeal preferred by the respondent herein before the Tribunal it was contended on its behalf that as the taxable sales of cooked food effected by the respondent during the relevant period were less than the value of Rs. 30,000 per year such sales should be held as exempt under entry 9 of the notification issued under section 41 of the Bombay Sales Tax Act to which we shall come a little later. This contention of the respondent was accepted by the Tribunal following its earlier decision in the case of Messrs. Jetharam Madhaoram (Second Appeal No. 1168 of 1969 decided on 29th January, 1971 ). It is the correctness of this decision, which is sought to be tested in the two questions referred to us.

(3.) IN view of what we have observed earlier, we are of the view that the Tribunal was right in coming to the conclusion that the exemption conferred by entry 9 was not lost merely on the ground that the total turnover of sales of the respondent exceeded Rs. 30,000. That exemption would be lost only where the turnover of taxable sales exceeded Rs. 30,000 during the relevant period.