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of <h1>High Court affirms Tribunal's decision on canteen sales exemption & deduction claim for assessees</h1> <h3>The State of Tamil Nadu Versus English Electric Company of India Ltd.</h3> The High Court upheld the Tribunal's decision in favor of the respondent-assessees regarding the exemption claimed on canteen sales turnover for the ... - Issues:1. Exemption claim on turnover related to canteen sales.2. Deduction claim on turnover related to sales return.Analysis:1. The case involved a dispute regarding the exemption claimed by the respondent-assessees on the turnover of canteen sales for the assessment year 1965-66. The assessing officer and appellate authority included the canteen sales in the taxable turnover, stating that the canteen was run by the assessees themselves and not by the employees on a co-operative basis. However, the Tribunal allowed the claim based on a previous court decision and a Government order exempting turnover from canteens run by employers or employees on a co-operative basis. The Government order required the employer to subsidize at least 25% of the total expenses. The Tribunal did not consider this aspect. The High Court found that the Government order applied even if the canteen was run by the employer under a statutory obligation without profit-motive, as long as the employer subsidized 25% of the expenses. The Court confirmed the Tribunal's decision on the canteen sales exemption, albeit on different grounds.2. The second issue revolved around the deduction claim of Rs. 4,673.46 on turnover related to sales return. The assessing officer and appellate authority rejected this claim due to discrepancies in verifying the credit notes issued by the assessees. However, the High Court, after examining the facts and circumstances, found that the assessees had provided sufficient material to support their claim. Referring to a previous decision, the Court held that the assessees were entitled to claim a deduction for sales return in the assessment year 1965-66, even if some sales were from the previous year. Consequently, the Court confirmed the Tribunal's decision on the deduction claim related to sales return. As a result, the tax revision petition was dismissed with costs.
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