Case Law Details
Commercial Taxes Officer Vs Chokhi Dhani Resorts Pvt Ltd (Rajasthan High Court)
Rajasthan High Court held that assessee cannot split up the amount charged for the sale of food and certain services in addition to the food. Hence, VAT is payable on the entire consideration charged for the food.
Facts- 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 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 penalty imposed u/s. 61 of RVAT Act. Thereafter, the Tax Board allowed the appeal filed by the assessee and set aside the levy of tax and interest also.
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