Dominant object test governs restaurant food supply: when sale is the substance, receipts are taxable as sale of goods.

The supply of food and drinks by a hotel-cum-restaurant was treated as a sale of goods where the dominant object of the transaction was sale and the rendering of service was only incidental. The Tribunal relied on the charging pattern, trading account entries, service charges in some cases, and the dealer's own conduct in charging sales tax to conclude that the receipts formed taxable turnover. The absence of a finding that customers were prohibited from taking food away did not change the character of the transaction. The revisional challenge failed because the finding that the business was essentially a sale transaction involved no legal infirmity.

---

---

Issues: Whether the supply of food and drinks by a hotel-cum-restaurant to residents and outsiders was a sale of goods liable to sales tax or merely a service.

Analysis: The governing principle was that the true nature of the transaction depends on its dominant object. Where the substance of the transaction is a sale of food and the rendering of services is only incidental, the supply is exigible to sales tax. The Tribunal examined the evidence, including the charging pattern, the trading account, the levy of service charges in some cases, and the dealer's own conduct in charging sales tax, and found that the dominant object of the activity was sale of goods. The absence of a finding that customers were prohibited from taking food away did not alter that conclusion.

Conclusion: The supply of food and drinks was rightly treated as sale of goods and formed taxable turnover under the Act. The finding was upheld against the assessee.

Final Conclusion: The revisional challenge failed because the Tribunal's conclusion on the true character of the business involved no legal infirmity.

Ratio Decidendi: The character of supply of food in a hotel or restaurant is determined by the dominant object of the transaction, and if sale is the substance while service is merely incidental, the receipts are taxable as sale of goods.

---