KADIYALA CHANDRAYYA Vs. STATE OF ANDHRA

JUDGEMENT

(1.) THIS is a revision against the order of the Andhra Sales Tax Appellate Tribunal confirming that of the Deputy Commissioner of Commercial Taxes.

(2.) THE petitioner is the proprietor of a non-vegetarian meals hotel called Sri Taj Mahal Hotel, Eluru. He was assessed for 1953-54 on a turnover of Rs. 27,000 on the best of judgment in the absence of a return from him. The Tribunal estimated the turnover at 4 times the cost of the mutton purchased. The learned counsel for the petitioner contended that the said multiple is arbitrary and is not supported by any reasonable basis. The Tribunal came to the conclusion, on the material placed before them, that, from 1st April, 1953, to 14th June, 1953, 2050 seers of mutton were purchased for Rs. 3072 working out an average roughly of 30 seers per day at Rs. 1-8-0 per seer. But, as there was no evidence of other purchases such as rice, vegetables, dhall, ghee, curd etc., which would be necessary to make a complete meal costing Rs. 1-4-0, the Tribunal estimated that four times the cost of the mutton purchased would represent the average sale proceeds per day, i.e., Rs. 180. On that footing, the net turnover for five months was fixed at Rs. 27,000. The assessment was, therefore, made on the relevant material placed before the Tribunal and we cannot say that it was mere guess work or was arbitrary.

(3.) UNDER this section, if a dealer sells articles of food and drink in a hotel, boarding house or restaurant with a turnover of not less than Rs. 25,000, he would be taxed at the rate of 4 1/2 pies for every rupee of his turnover but a dealer in similar articles with less turnover in a hotel, boarding house or restaurant or in different articles with a turnover of more than Rs. 25,000 or a dealer in any article including articles of food and drink with any turnover, whether less than Rs. 25,000 or more than that amount, selling outside a hotel, boarding house or restaurant would be charged at the rate of three pies for every rupee on such turnover. It is said that this discrimination between one class of dealer from another class is irrational and offends the fundamental right of the assessee to the equal protection of laws guaranteed by Article 14 of the Constitution. The counsel appearing for the State supports this apparent discrimination on the principle of reasonable classification.