HOT MILLIONS Vs. UNION TERRITORY

JUDGEMENT

(1.) THE firm by the name of Hot Millions, Sector 17-D, Chandigarh (hereinafter referred to as the petitioner), through the present writ petition has prayed for the issuance of a writ of certiorari for quashing "final notice" dated 26th November, 1982 (annexure P. 2), and two subsequent notices dated 27th December, 1982 (annexures P. 3 and P. 4), issued by the Excise and Taxation Officer-cum-Assessing Authority, Union Territory, Chandigarh, respondent No. 2. The notice (annexure P. 2) is in the form of a decision rejecting various contentions raised by the petitioner in its representation dated 18th October, 1982 (annexure P. 1), which, as the text shows, was in response to some earlier notices issued by respondent No. 2 in respect of sales tax assessment for the years 1980-81, 1981-82 and 1982-83.

(2.) THE petitioner's contention in the representation (annexure P. 1) as also in the writ petition is that the petitioner has set up a restaurant by the name of Hot Millions in a posh locality in Sector 17, Chandigarh, which is being run by it providing various services and amenities such as central cooling, wall to wall rubber laid carpeting and mosaic flooring, special sophisticated made to order furniture, counters of marble all around and the walls behind the counters are all made of marble. It is averred that the kitchen equipment is electric/gas and is highly sophisticated. It is laid out to ensure cleanliness and please the palate of the visitors, This facility is specifically provided to make a visual appeal to the visitors wishing to satisfy their bodily needs. Specialised, trained and skilled staff is employed by the petitioner to ensure quick preparation and services and that the visitors personal tastes are catered with promptness. There are pleasant and tasteful setting, furnishings, potted plants, etc. Besides, music, western and traditional, is played through a sophisticated stereophonic system in the establishment. Lighting arrangement is so made as to give a soothing feeling. Serviettes provided are of finest and cutlery and crockery are of the best quality. Besides the said service, food and beverages are provided by the petitioner in the restaurant. The personnel working in the restaurant are elegantly dressed who look after the needs of the visitors. The charge made for the services rendered is based upon per head or per dish for the consumption at the premises. Eatables and beverages are provided as hospitality for satisfaction of a bodily desire, ministering a bodily want of the visitors. The transaction for providing the said services, according to the petitioner, is one essentially of service the performance of which is part of the amenities incidental thereto are provided in terms of offering hospitality. As stated above, the petitioner received notices from respondent No. 2 for sale tax assessment for the years 1980-81, 1981-82 and 1982-83 in reply to which representation (annexure P. 1) was made wherein all the above facts, besides others, were delineated. The judgment of the Supreme Court in Northern India Caterers (India) Ltd. v. Lt. Governor of Delhi [1978] 42 STC 386 (SC), besides the view on the same lines taken by the different High Courts, was also brought to the notice of respondent No. 2. The petitioner thus contended that the articles of food or beverages being served in its restaurant cater to the needs of the visitors who consume and destroy the same by consumption and such service does not amount to sale of eatables and beverages. Respondent No. 2, however, turned down the contentions made by the petitioner in the representation (annexure P. 1) vide "final notice" (annexure P. 2) wherein the law laid down by the Supreme Court in Northern India Caterers' case [1978] 42 STC 386 (SC), and the judgments of different High Courts following the law so laid down by the final Court were sought to be distinguished on the following grounds : (a) The customers have to carry eatables from the counter themselves. (b) The customer is not attended by any waiter for the order booking. (c) The customer has to stand in a queue to get coupons of the delivery of snacks. (d) The customer cannot sit at ease to enjoy the environment around because he is always in anxiety to go for the delivery of eatables at the counter. This does not give pleasure of service as envisaged by the Supreme Court in Northern India Caterers' case [1978] 42 STC 386 (SC ). (e) The waiter standing across the counter shouts for the customers when eatables are ready. (f) The area of the petitioner's premises is so congested that one cannot sit at ease like a restaurant in wide open place. The premises of the petitioner is known as "snack-bar". The meaning of "bar" means to stand at a place. In every restaurant the customer is provided water on arrival into it by a well-dressed waiter and which adds to the service of the customers. In the petitioner's premises, one has to drink water from the cooler. (g) It has been generally seen that in the premises of the petitioner, that the customers have a right over the left-over because due to paucity of space the customers sometime carry the snacks outside and eat around the fountain.

(3.) RESPONDENT No. 2 thus concluded that the eatables and beverages served at the petitioner's premises are liable to sales tax and, therefore, directed the petitioner to produce the account books for the years 1980-81, 1981-82 and 1982-83 for working out the tax liability. To the same effect are the notices (annexures P. 3 and P. 4 ). The petitioner has impugned the legality and validity of the above notices.