COMMISSIONER OF SALES TAX Vs. HUKUMCHAND MILLS

JUDGEMENT

(1.) THIS review petition, at the instance of revenue, is directed against the common order dated 19-12-1995 passed by the Full Bench comprising of Hon'ble three Judges in M. C. C. No. 365 of 1985; M. C. C. No. 366 of 1986; M. C. C. No. 367 of 1986 and M. C. C. No. 446 of 1986. By the order impugned four reference applications made under Section 44 (1) of the M. P. General Sales Tax Act, 1958 since repealed (hereinafter referred to as 'act') were disposed off and the question referred by the Tribunal in each application was answered in the affirmative i. e. , in favour of the respondent herein and against the revenue. It was further held that Division Bench decision in Commissioner of Sales Tax v. Gwalior Rayon Silk Mfg. Co. Ltd. , Nagda, (1989) 3 TLD 106 does not lay down correct law in so far it holds that sale of food articles in the canteen were exigible to tax.

(2.) FOR the assessment years 1974 to 1976 and 1978 turnover of canteen sales run by the respondent, a public limited company and a registered dealer under the Act (hereinafter referred to as 'assessee') were assessed to sales tax together with other taxable turnover by the assessing officer under the provisions of the Act. In first appeals, contentions of assessee were not accepted and the assessment orders were maintained. Second appeals preferred by the assessee were allowed and it was held by the Board of Revenue that assessee was mainly engaged in the manufacture and sale of cloth and yarn, but since it employed more than 250 workers, therefore, as per provisions of the Factories Act and Rules framed thereunder, assessee had to establish and run the canteen as welfare measure. Canteen located in the Mill was held to be a service institution; therefore, turnover of canteen sales could not be added to other taxable turnover of the assessee for the years in question. Against the said orders, revenue placing reliance on a decision of Supreme Court in case of State of Tamil Nadu v. Burma Shell Oil Stores and Distributing Co. of India Ltd. , 31-STC 426, sought reference by filing applications under Section 44 of the Act. Applications were allowed by the Board of Revenue and accordingly in each matter Statement of Case was referred to this Court for the decision on the following question of law :-

(3.) INITIALLY as per Rules, references were listed before Division Bench which was of the view that there is a conflict between two Division Bench decisions reported in (1987) 20 V. K. N. 351 and (1989) 3 TLD 106 therefore, by order dated 12-4-1989 it was directed that matter be placed before Hon'ble the Chief Justice for constituting Larger Bench to resolve the conflict. By virtue of order of Hon'ble the Chief Justice, all four M. C. Cs. as mentioned herein above were heard and decided by the Full Bench by common order dated 19-12-1995 as mentioned hereinabove. It is against this order of the Full Bench, Revenue has filed the present review application along with an application under Section 5 of the Limitation Act 1963, for condonation of delay. At this stage it is pertinent to point out that in the interregnum period, assessee went into liquidation and an Official Liquidator was appointed, therefore notices were issued to Official Liquidator who has filed reply to application under Section 5 of the Limitation Act opposing condonation of delay. Looking to the issue involved in the case, delay was condoned and Shri G. M. Chaphekar, learned Senior Counsel was requested to address the Court as Amicus Curiae. Since the matters were heard and decided by the Full Bench of three Hon'ble Judges of the Court that is why, this review application has been laid before us.