NORTHERN INDIA CATERERS (INDIA) LTD. vs LT. GOVERNOR OF DELHI

The Supreme Court ruled that the service of meals to non-residents in a restaurant does not constitute a taxable sale under the Bengal Finance (Sales Tax) Act, 1941. The Court held that the transaction is primarily a service rather than a sale of foodstuffs, aligning with its previous decision in State of Punjab v. M/s. Associated Hotels of India, which established that supplying meals is a service to guests. The appeals were allowed, overturning the High Court's affirmation of the sales tax authorities' decision.