Cooked meal supply from own premises is not outdoor catering service; service tax demand and penalties fail.

Preparation and supply of cooked mid-day meals from the provider's own premises to the Education Department did not amount to taxable outdoor catering service under the Finance Act, 1994, because the meals were neither prepared nor served at the place of consumption and the provider was not involved in serving them at schools. On that basis, the service tax demand failed, and the associated interest and penalties also could not be sustained. The earlier decision on an identical issue was followed, and the impugned order was set aside with consequential relief.

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Issues: (i) Whether supply of cooked mid-day meals from the appellant's own premises to the Education Department amounted to taxable outdoor catering service under the Finance Act, 1994; (ii) whether the demand of service tax, interest and penalties could be sustained.

Issue (i): Whether supply of cooked mid-day meals from the appellant's own premises to the Education Department amounted to taxable outdoor catering service under the Finance Act, 1994.

Analysis: The activity involved preparation of meals at the appellant's institute and supply of the cooked food to the Education Department through its arranged transport. The meals were not prepared or served at the place where they were ultimately consumed, and the appellant was not involved in serving the meals at the schools. The activity was also treated as sale of cooked food and not as catering service at a place other than the appellant's own premises.

Conclusion: The activity did not fall within the definition of outdoor catering service and was not taxable under the said head.

Issue (ii): Whether the demand of service tax, interest and penalties could be sustained.

Analysis: Once the activity itself was held to be outside the taxable category, the foundation of the demand disappeared. The earlier decision on an identical issue was followed, and the impugned order confirming tax, interest and penalties could not survive.

Conclusion: The demand of service tax, interest and penalties was unsustainable and was set aside.

Final Conclusion: The appeal succeeded and the impugned order was annulled, with consequential relief as permissible in law.

Ratio Decidendi: Preparation and supply of cooked meals from the service provider's own premises, without serving them at the place of consumption, is not outdoor catering service under the service tax law.

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