Outdoor catering tax applies only to the service element, while marketing leads for a client can fall under Business Auxiliary Service.

Outdoor catering is treated as a composite but divisible contract: the sale value of food is separable from the service element, so service tax applies only to the taxable service component where invoices separately show goods and service charges. Reimbursable expenditure for items such as flowers and posters is not includible in the taxable value. By contrast, facilitating marketing leads for a client in return for consideration linked to the billed amount falls within Business Auxiliary Service and is taxable accordingly. The analysis therefore distinguishes between exclusion of the goods and reimbursement components from service tax and taxation of marketing/promotion activity as a service.

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Issues: (i) Whether service tax on outdoor catering was leviable on the entire value of food and service charges or only on the service component, and whether reimbursable expenditure for flowers and posters was includible in the taxable value; (ii) Whether the amount received for providing marketing leads to M/s. Epicurean Enterprises Pvt. Ltd. was taxable under Business Auxiliary Service.

Issue (i): Whether service tax on outdoor catering was leviable on the entire value of food and service charges or only on the service component, and whether reimbursable expenditure for flowers and posters was includible in the taxable value.

Analysis: Outdoor catering was treated as a composite but divisible contract in which the supply of food represented the sale element and the catering activity represented the service element. Where invoices separately showed the value of goods and service charges, exemption under Notification No. 12/2003-ST was available to the extent of the goods component. Reimbursable expenditure could not be added to the taxable value in view of the principle that such amounts are outside the measure of service tax.

Conclusion: The demand on the entire value was not sustainable, and the demand on reimbursable expenditure was also not sustainable; both were set aside in favour of the assessee.

Issue (ii): Whether the amount received for providing marketing leads to M/s. Epicurean Enterprises Pvt. Ltd. was taxable under Business Auxiliary Service.

Analysis: The activity was found to be promotion or marketing of the client's service, since the appellant facilitated procurement of the contract for M/s. Epicurean Enterprises Pvt. Ltd. and received consideration linked to the billed amount. Such activity fell within the statutory ambit of Business Auxiliary Service.

Conclusion: The amount received for marketing leads was taxable under Business Auxiliary Service and the demand was upheld against the assessee.

Final Conclusion: The appeal succeeded only to the extent of the outdoor catering and reimbursable expenditure demands, while the demand relating to Business Auxiliary Service was sustained.

Ratio Decidendi: In outdoor catering matters, the taxable service component must be separated from the value of goods, and reimbursable expenditure is not includible in the taxable value; conversely, promotion or marketing of a client's service for consideration falls within Business Auxiliary Service.

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