hall charges received for party by a restaurent

[NAND LAL JAIN]

we are running a restaurant, providing kitty parties of 20 to 25 persons. We are charging as under: 

 

Rs. 1000/- per person + vat 12.5% + service tax with 60% abatement.  

and hall charges of Rs. 5000/- .

Now question is : In which category of Services we should consider hall charges. i.e. under Business Auxiliary Services (In which we have to pay service tax on 100% amount)  OR

 

under short term Accommodation services (In which we have to pay services tax on 50% amount) and

also whether we have to charges luxury tax if so how much amount. 

 

 

[Rama Krishana]

Billing terms my be different i.e. lump sum plus per person but the nature of activity appears as one and only one which may be classified as bundled service tax by way of supply of food and providing accommodation. Therefore rate of abatement is same for all the items. You need to pay service tax after abatement @70%.

AI Summary

Bundled service tax: treat hall and food as a single supply and apply common abatement, then pay tax. The restaurant's provision of food and hall facilities for kitty parties constitutes a single bundled supply of food and accommodation; the same abatement applies to all components and service tax must be paid on the value remaining after applying that common abatement. Billing segmentation does not change classification. The reply does not separately address luxury tax.