JUDGMENT R.R. Rastogi, J.
1. The Commissioner of Sales Tax has filed this revision under Section 11(1) of the U.P. Sales Tax Act, 1948 (hereinafter the Act). The assessee deals in preparation and sale of sweets, namkin, cold drinks, etc. For the assessment year 1973-74 he disclosed the taxable turnover as Rs. 66,993.40. For various reasons the assessing officer did not accept the book version and estimated the net turnover at Rs. 1,60,000. The assessee appealed. The appellate authority upheld the rejection of book version, but reduced the estimate of turnover to Rs. 40,000. The assessee then took up the matter in revision before the Additional Judge (Revisions), Sales Tax, Varanasi. The making of the best judgment assessment was not challenged before him. For the first time, however, it was contended that the assessee being a restaurant was not liable to pay any tax on his turnover since he provided many services in addition to supply of food and reliance was placed on a recent decision of the Supreme Court rendered in the case of Northern India Caterers (India) Ltd. v. Lt. Governor of Delhi AIR 1978 SC 1591 The revising authority accepted this contention and held that there was no evidence of any counter sales and the assessee was not liable to pay any tax on the out-turn in respect of cooked food, sweets, tea, coffee, etc. The tax levied on purchases of foodgrains was upheld. Being aggrieved the Commissioner has filed the present revision.
2. Before proceeding further, it may be noted that in one of the questions raised in the revision application it has been said that the revising authority was not justified in holding that the turnover of foodgrains was not liable to tax. This question appears to have been raised under some misconception because the revising authority has confirmed the liability of the assessee to pay tax on food-grains, the out-turn of which was taken at Rs. 20,000 which was the figure sustained by the Assistant Commissioner (Judicial), and against which estimate there was no revision filed by the Commissioner. Therefore, the question is not to be gone into in this revision.
3. The first submission made before me on behalf of the Commissioner by Sri V.D. Singh was that the controversy raised by the assessee in the appeal before the Assistant Commissioner (Judicial) was limited to the claim of exemption on the ground that tax could not be levied on cooked food and for the first time before the revising authority the assessee could not have contended that he was not liable to pay any tax on its turnover of cooked food, sweets, namkin, etc. According to the learned counsel it was a mixed question of fact and law, and even if the decision in Northern India Caterers AIR 1978 SC 1591 was applicable to this case, it was necessary to investigate into certain facts and apart from that there was no service of meals at all by the assessee and it was the case of outright sales made by him. Further, if as a result of the aforesaid decision there arose any mistake on the legal aspect of the case, the remedy of the assessee was to make an application under Section 22 of the Act for rectification thereof. After hearing the counsel for the parties I am not inclined to accept this submission. On facts it may be noted that there was no question of any further investigation because a finding was recorded by the additional revising authority that there was no evidence of counter sales. This finding has not been challenged in the present revision. In other words, cooked food, sweets, and hot and cold drinks were served by the assessee at his own premises. The decision of the Supreme Court in Northern India Caterers AIR 1978 SC 1591 was given on 7th September, 1978, while the appeal was filed by the assessee and decided much before that. Therefore, the assessee could not have taken this plea before the appellate court. The decision of the Supreme Court would amount to declaration of law as it always was and if the assessee was not aware of it earlier there appears no reason as to why he could not take advantage of it before the revising authority when he came to know of it. I agree with the submission made on behalf of the assessee that there can be no estoppel against law. If in law the assessee was not taxable on the turnover in respect of the abovementioned commodities, then certainly he could not have been taxed thereon. Apart from this a point which goes to the root of the matter and which affects the very existence of the jurisdiction of an authority can be raised at any time, be it in appeal or revision : see Commissioner of Sales Tax v. Ram Chand [1978] 42 STC 432. Thus the question as to whether the assessee was liable to any tax under the Act went to the very root of the matter and in my opinion this point could be raised even at the time of the revision.
4. Sri V.D. Singh, in support of his contention, placed reliance on the decision in Gaddar Mal Dau Dayal v. Commissioner of Sales Tax 1972 UPTC 262, in which it was laid down that the assessee having admitted the liability to pay the tax and having deposited the same on the admitted turnover before the appellate authority, was barred from raising the plea that the commodity in question was exempt from tax in the relevant assessment year in revision application before the Judge (Revisions), Sales Tax. In my opinion this decision is distinguishable inasmuch as the assessee is claiming total exemption from tax and it is not in respect of any commodity that he has claimed such exemption. Further he is claiming exemption on the ground that he was not making any sales at all but whatever he was preparing he was serving it at his own premises and hence in respect of the same sales tax was not exigible. As noted above, this contention goes to the very root of the matter and certainly it could be taken for the first time even in revision.
5. However, in view of a recent order dated 21st December, 1979, passed by the Supreme Court on a review application in the case of Northern India Caterers (India) Ltd. [1980] 45 STC 212 (SC) before applying the decision rendered earlier to the present case, further investigation would be required. Their Lord-ships have now explained that decision. In that case, the appellant prepared and served food both to residents in its hotel as well as to casual customers who came to eat in its restaurant and throughout it maintained that having regard to the nature of services rendered there was no real difference between the two kinds of transactions. In both cases it remained a supply and service of goods not amounting to a sale. Those facts were not disputed at any stage and their Lordships have now explained that the decision rendered earlier was confined to the factual foundation obtaining in that case. In order to allay the apprehension that the benefit of that judgment will be invoked by restaurant-owners in those cases also where there is a sale of food and title passes to the customers, it has been made clear :
Indeed, we have no hesitation in saying that where food is supplied in an eating-house or restaurant, and it is established upon the facts that the substance of the transaction evidenced by its dominant object, is a sale of food and the rendering of services is merely incidental, the transaction would undoubtedly be exigible to sales tax. In every case it will be for the taxing authority to ascertain the facts when making an assessment under the relevant sales tax law and to determine upon those facts whether a sale of the food supplied is intended.
In view of this pronouncement, it would be necessary to refer back the case to the revising authority to determine whether the rendering of services by the assessee is the dominant object or is merely incidental to the sale of food which in substance is the dominant object and if that is so the out-turn in respect of the sale of cooked food, tea, etc., would be exigible to sales tax.
6. The revision is hence allowed and the case is referred back to the revising authority to decide it afresh, according to law, keeping in view the observations made above. In the circumstances of the case, there shall be no ordei as to costs.