KERALA HOTEL & RESTAURANT ASSOCIATION AND ORS. ETC. ETC. versus STATE OF KERALA AND ORS.

KERALA HOTEL & RESTAURANT ASSOCIATION AND ORS. ETC. ETC. versus STATE OF KERALA AND ORS.

The classification for imposition of sales tax based on the status and tariff of eating establishments (luxury hotels versus modest eating houses) is neither discriminatory nor arbitrary, as it bears rational nexus to the object of raising revenue from those who can afford costlier food, consistent with economic equality and legislative wisdom; thus, it does not violate Article 14.

Parties
Appellants/petitioners: Kerala Hotel & Restaurant Association and others; Respondents: State of Kerala and others; Appellant/respondent: State of Tamil Nadu
Jurisdiction
India
Judgment Date
21 February 1990
Procedural Posture
Civil Appeals and Writ Petition / Final Supreme Court Judgment
Outcome
Appeals and connected writ petition by hoteliers dismissed; appeals by State of Tamil Nadu allowed.
Legal Topics
Classification Under Article 14, Sales Tax, Discrimination, Economic Equality
Constitutional Law Taxation Law Classification Under Article 14 Sales Tax Discrimination Economic Equality

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Parties

Kerala Hotel & Restaurant Association and others

Appellants/petitioners

State of Kerala and others

Respondents

State of Tamil Nadu

Appellant/respondent

Procedural Posture

Civil Appeals and Writ Petition / Final Supreme Court Judgment

Legal Issues

  1. 1 Whether imposition of sales tax on cooked food sold only in luxury hotels, while exempting modest eating houses, violates Article 14 of the Constitution due to discrimination

Ratio Decidendi

The classification for imposition of sales tax based on the status and tariff of eating establishments (luxury hotels versus modest eating houses) is neither discriminatory nor arbitrary, as it bears rational nexus to the object of raising revenue from those who can afford costlier food, consistent with economic equality and legislative wisdom; thus, it does not violate Article 14.

Court Disposition

Appeals and connected writ petition by hoteliers dismissed; appeals by State of Tamil Nadu allowed.

Orders

  • Civil Appeal Nos. 912-20 of 1988 and Writ Petition No. 281 of 1988 challenging validity of Kerala Act dismissed.
  • Civil Appeal Nos. 4460-80 of 1985 against Madras High Court decision allowed, resulting in dismissal of relevant writ petitions.