TITLE: Commercial Taxes Officer v. Chokhi Dhani Resorts Pvt. Ltd.
Decided on: 02/06/2023
Case No.: S.B. Sales Tax Revision / Reference No. 63/2020
Coram: HON’BLE MR. JUSTICE SAMEER JAIN
Facts of the case:
The present Sales Tax Revisions/References (for short “STRs”) have been filed by the revenue, under Section 84 of the Rajasthan Value Added Tax Act, 2003 (for short “RVAT Act”) read with Section 86 of the Rajasthan Sales Tax Act, 1994 (for short “RST Act”), assailing the impugned order dated 23.18.2019 passed by the Rajasthan Tax Board, Ajmer and involves the following question of law:
- i) Whether in the facts and circumstances of the case, the Rajasthan Tax Board was justified in law in holding that the expenses charged are separate from the food charges despite only one coupon of the composite amount issued at the entry by the respondent.
- ii) Whether in the facts and circumstances of the case the Rajasthan Tax Board was justified in law in deleting the tax and interest without appreciating the provisions pertaining to “Sale” as contemplated u/s 2(35) of the Act and “Sale Price” as contemplated u/s 2(36) of the Act.
The revenue submits that a survey was conducted of the premises of the assessee on 14.07.2010 wherein it was discovered that the assessee, which is engaged in the business of restaurants and resorts, was issuing ‘entry coupon’ at the entry gate of the premises to its customers and charging Rs. 350/- per adult and Rs. 175 per minor. The said charge, as per the entry coupon, is only adjustable against food. However, the assessee was only paying VAT on Rs. 250 (in case of adults) or Rs. 125 (in case of children) and the remaining amount, i.e. Rs. 100 (in case of adults) and Rs. 50 (in case of children) was reflected separately in the assessee’s books of accounts under the head Charges for generation of Cultural Receipts, Staff, Maintenance, Adm. Expenses’ and no VAT was being paid on the same, which amounts to an evasion of tax.
Accordingly, the Assessment Order dated 25.02.2011 was passed and tax along with interest and penalty was imposed upon the assessee. Upon appeal, the Deputy Commissioner (Appeal), vide order dated 23.03.2012, maintained the levy of tax and interest, but deleted the penalty imposed under Section 61 of the RVAT Act. Thereafter, the Tax Board allowed the appeal filed by the assessee and set aside the levy of tax and interest also.
The assassin was separately charged for other services, like animal riding, astrology services and other recreational activities, inside the premises and the entry coupon specifically contained the words “adjustments in food only”. The assessee cannot split up the amount charged for sale of food, even if the assessee provides certain services in addition to food as VAT has to be paid on the total amount charged.
Judgement
The questions of law framed hereinabove have to be answered in favor of the revenue and against the assessee. Accordingly, the impugned order of the Tax Board is quashed and set aside and the levy of penalty is maintained. Consequently, all these STRs are allowed. Pending application(s), if any, shall stand disposed of.
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Written by: Mahima Saini
