Sarva Shri Neeraj Misthan Bhandar Vs The Commissioner, Commercial Tax (Uttarakhand High Court)
In this case, we are concerned with the question as to whether Samosa is to be treated as namkeen or cooked food and we are not asked to pronounce upon whether it is to be treated as unclassified items, the choice is narrowed down to whether it is to be treated as namkeen or as cooked food. If we apply the test as to whether it is consumable in the sense that it would be ready to be eaten unlike the case of fryums, there can be no manner of doubt that samosas are cooked food. This if for the reasoning that when a person dealing in samosa offers it for sale to the consumers, then without any further act on the part of consumer, it is ready to be consumed and it is in a consumable condition. In that sense, there can be no doubt that it is cooked food. There can also be no doubt that samosa is a product which emerges or gets manufactured after involving a process of cooking.
Contrast this with namkeen. Namkeen is found in the company of sweets in the entry concerned. Samosas are not sweets. In fact, there is no case of the petitioner that it is to be characterized as sweets. It is brought to our notice that samosa is an item which is cooked and it is ready to be eaten and it is ordinarily consumed without much delay from the time when it is cooked. Ordinarily, it is meant to be so consumed. Learned representative of the State urges before us the distinction between namkeen and samosa to be that namkeens have larger longer shelf-life, the products which can be consumed even over a long period of time perhaps by addition of requisite preservatives.
While it is true that the assessee has raised a ground that samosa is to be taxed at 5% and not at 8%, there is no expatiation of the ground as to what would be the basis. There is no material produced by the assessee in support of the contention that Samosa is to be treated as namkeen and not as cooked food. Under the law, the assessee could have produced material or evidence in support of the contention that samosa is namkeen. Namkeen is ordinarily understood as mixtures and daalmot. It is unlikely that if a person walks into a shop and asks for namkeen, he would be offered samosa.
We must record that we are conscious of the fact that Samosa may not be a meal as such as was understood by the Hon’ble Apex Court in the case of Annapurna Biscuit Manufacturing Co (Supra). In fact, the learned counsel for the revisionist emphasized that the word “cooked food” is called in Hindi as “pakaya hua bhojan” and in that sense, it may be correct to say that Samosa may not be a meal as such. But, here we are constrained to incline ourselves to take the view that Samosas are more appropriately dealt with under the entry “cooked food” rather than “namkeen”. We have noticed that samosa is certainly cooked food and since it satisfies requirement of cooked food otherwise in a broad sense and since the other alternative is to tax it under namkeen which does not appeal to us, in the absence of any material or finding in the orders, we are inclined to not overturn the order of the authorities, as confirmed by the Tribunal which is undoubtedly the fact finding authority as samosas are to be taxed at the rate of 8% for the first six months and, for the next six months, at the rate of 4%, on the basis that cooked food under the VAT Act attracted 4%.
Therefore, we would answer the question of law which is framed as question No.2 against the assessee and in favour of the Department.
FULL TEXT OF THE HIGH COURT JUDGMENT / ORDER IS AS FOLLOWS:-
These two Revisions are filed by the same assessee. CTR No. 36 of 2010 relates to the period 01.04.2005 to 30.09.2005, whereas, CTR No. 37 of 2010 relates to the period 01.10.2005 to 31.03.2006. It be noted that the period 01.10.2005 to 31.03.2006 is the period which was covered by the VAT Act.
2. The revisionist is running a shop. In the shop, the revisionist sells sweets, namkeen, samosa, milk and curd. For the first period of six months as aforesaid, the revisionist was assessed to tax for a sum of Rs.50,720/- on the basis that the turnover sale was Rs.11,55,900/-. In CTR No. 37/2010, the order of assessment shows that the revisionist was assessed on Rs.13,66,400/-. The first Appeal was unsuccessful and equally the Appeal preferred before the Tribunal was unsuccessful. As such, the revisionist is before us. The following substantial questions of law have been raised in the memorandum of Appeal:
“(a) Whether on the facts and circumstances of the case the learned assessing authority and learned Tribunal was justified in law that the statement were made by the son of the proprietor of the firm not by the employee of the firm?
(b) Whether on the facts and circumstances of the case the learned Commercial Tax Tribunal was justified in law in not giving any finding that what will be the rate of tax of Samosa for prevailing assessment year whether it should be @ 8% or whether it should be @ 5%
(c) Whether on the facts and circumstances of the case the learned Commercial Tax Tribunal was justified in law in not appreciating the fact that two standards cannot be opted by the Commercial Tax Authority for two shops adjacent to each other?”
3. We have heard Mr. S.K. Posti, learned counsel for the revisionist and also Mr. Mohit Maulekhi, learned representative for the Department/respondent.
4. Learned counsel for the revisionist, Mr. S.K. Posti would submit that this is a case where there was a survey, which took place on 28.07.2005. The adjoining shop is a much bigger shop, almost double the size of the revisionist’s shop. The Assessing Officer has proceeded to assess the revisionist at a huge amount in the matter of turnover and, therefore, taxed after finding that the revisionist has not maintained the manufacturing account. He would, first of all, submit that this is unsustainable and in this regard, he would also rely on judgment of the Hon’ble Allahabad High Court in the case of Munna Lal Sons & Co. (P) Ltd. vs. Commissioner of Trade Tax, U.P. Lucknow reported in 2003 (129) STC 27.
5. Next, it is the case of the learned counsel for the revisionist that the item “Samosa” has been taxed as if it is cooked food and, therefore, it has been taxed @ 8%, whereas, it should have been taxed under the entry of Sweets and Namkeen and, therefore, it has to be taxed @ 5%. According to the learned counsel for the revisionist, cooked food has got a connotation in law. It means food which one takes as a meal and when somebody orders for a meal, he would ordinarily not be satisfied with Samosa. These are all matters, which would be decided on the basis of common parlance/understanding.
6. He would also submit that in fact Samosa in respect of the adjoining shop, has been taxed @ 4% under the entry “Sweets and Namkeen”.
7. Per contra, the State representative, Mr. Mohit Maulekhi would submit that Namkeen is to be treated as cooked food. He would submit that the distinguishing feature of namkeen is that it has longer shelf-life, whereas, Samosa is an item which is to be consumed immediately. As far as rejection of accounts is concerned, he would submit that there was material to reject the same.
8. As far as the first question of law, which is raised is concerned, we are of the view that we cannot treat this as a question of law as such.
9. Then, there remains the second question as to whether the rate of tax on Samosa should be 8% or 5%. It is necessary to notice the relevant entries for the first period and the matter was governed by U.P. Trade Tax Act. The following are the entries relating to two items, namely “sweets and namkeen” inter alia and “cooked food”.
