Restaurant food supplies remained outside trade tax under the pre-amendment rule; deemed-sale change applied prospectively.

Food and other consumables served in a restaurant were not subject to trade tax for periods before the deemed-sale amendment took effect, because the pre-amendment rule treated such supply as not amounting to a sale. The corresponding amendment to the U.P. Trade Tax Act was held prospective and not retrospective, so it did not alter liability for earlier years. On that basis, the earlier legal position continued to apply to the assessee's relevant assessment periods, and the supplies made before the effective date remained outside trade tax.

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Issues: Whether the supply of food and other consumables served in a restaurant was liable to trade tax for the period prior to 2 February 1983, and whether the amendment introducing deemed sale applied retrospectively.

Analysis: The earlier rule that food served in a restaurant did not amount to a sale governed the period before the constitutional amendment introducing Article 366(29A)(f). The corresponding amendment to Section 2(h)(vi) of the U.P. Trade Tax Act, 1948, inserted by U.P. Act No. 25 of 1985 with effect from 2 February 1983, was held to be prospective and not retrospective. As the assessee's case related to years prior to that date, the pre-amendment legal position continued to apply.

Conclusion: The restaurant supplies for the period prior to 2 February 1983 were not exigible to trade tax, and the assessee succeeded on this issue.

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