MUNICIPAL CORPORATION OF DELHI versus LAXMI NARAIN TANDON ETC. ETC.

Citation: [1976] 2 S.C.R. 1050 · Decided: 17-12-1975 · Supreme Court of India · Bench: Y.V. CHANDRACHUD · Disposal: Appeal(s) allowed
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Judgment (excerpt)

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1050 
MUNICIPAL CORPORATION OF DELHI 
v. 
LAXMI NARAIN TANDON ETC. ETC. 
December 11, 1975 
[Y. V. CHANDRACHUD, P. N. BHAGWATI AND R. S. SARKARIA, JJ.) 
••Sale" -Distinction be11·/een-Prevention dj Food -Adulteration Act, 1954, 
and Punjab General Sales. Tox Act. 
Storing an article of food for purposes other than sale-I/ constitutes all, 
offence-Supply and offer of food by a hotelier to a customer under a conso-
ltdated charge-If constitutes sale within the nzeaning of Prevention of Food 
A.dulterc.ilian Act. 
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The respcndents Y.'ere charged with. an offence under s. 7 read with s. 16 
or the Prevention of Food Adulteration Act, 1954 .. on the ground that they had 
stored far sale articles of food, which were adulterated and of sub-standard 
quality. Before the ~Iagistrate, the respondents contended that no articles of 
food \Vere-sold in the hotel to non-resident visitors. or the public generally and 
that the hotel provided residential /services and other amenities including meals 
only tQ, resident customers against a composite charge and that no rebate was 
ano .. ved for food if a resident customer. chose not to eat it The 11agistrate 
acquitted the respondents. 
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On appeal the Division Bench of the High: Court referred two questions to 
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the Full Bench. namely, (i) whether for the purposes of the Prevention or Food 
Adulteration Act, 1954, there was no scle of food provided by a hotelier to a 
guest when a consolidated charge was made; and (ii) whether the expression 
"store'' used in ss. 7 and 17 of the Act means storage: simpliciter or storing for 
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sale? 
The Full Bench held ( 1) that there was no 'sale' of food to the customer 
within the contemplation of the Act; and (2) that the word "store" used in ss. 7 
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·and 16 means storage for sale. 
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Allowing the appeals, 
HELD : (I) The· High Court has over·looked the important distinction bet· 
ween the connotation of .. sale" for the purposes of Sales Tax Act and the one 
under the Prevention of Food Adulteration Act. The supply of food by a 
hotelier to a customer when a consolidated charge is made for residential accom-
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modation and other amenities, including fcxxi, amount9 to a ''sale" of an article 
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of food for the purposes of the Prevention of Food Adulteration Act. [1057 
B and 1058 FJ 
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(a)_ A comparative study of the definition- of 'sate' in the Sales Tax Act 
and the Prevention of Food Adulteration Act would show that the connotation 
of "sale"_ for the purposes of Prevention of Food Adulteration Act is far wider 
than the meaning assigned to it in the Sales Tax Act. [1056. B] 
(b) The object of the Sales Tax Act is to levy tax on sales or purchases 
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of certain articles of commerce. The object of the Prevention of Food Adultera-
tion Act is to prevent, in the i):lterest of the health of the community, supply 
of adulterated foodstuffs by a person as a part of his business activity. [1056 F 
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(c) For the purPoses·of the Prevention of Food Adulteration-Act the broad 
test applicable would be, whether the article of food was offered by the hotelier 
to the resident customer for a money consideration, it being immaterial v:hether 
such consideration was a distinct item or was an inseparable element of the 
consolidated charge made by the hotelier for providing residential accommoda-
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services, amenities and food. The mere fact that the property in lhe food 
article does not pass to the customer before he eats it doeS not take it out of 
the definition of "sale" under the Food Act. In the case of food actually con·· 
sumed, the property does pass to the customer. Jn other case9, even when. the 
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MUNICIPAL CORP. v. L. N. TANDON (Sarkaria, J.) 
1051 
resident customer does not eat the i'ood offered to him by the hotelier, such an 
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offer by itself would be sufficient to constitute a "sale" of that article of food 
within the contemplation of s. 2(xiii) of the Food Act. The fact remains that 
the supply or offer of food to a customer i! for a money consideration as a part 
of business activity and, as such, constitutes "sale" under the Prevention of 
Food Adulteration Act. [1057 C-D 1058 CJ 
(d) The object of assigning w extensive a meaning to the term "sale" is 
to bring within the ambit of the Prevention oi' Food Adulteration Act all com-
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mercilll transactions whereunder an adulterated article of food i~ supplied for 
consumption by one person to ano
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