Sale of MRP Products like PEPSI AND LAYS

[MUNIRAJ SRINIVASAN]

Service to customer place like Door Delivery

MY client has desired to sale of Combo Lunch it is inclusive of Lays and Pepsi whether service tax is applicable for MRP based Products?

he is selling Burger and Backery food along with Pepsi and Lays whether all products attract to Service tax

 

 

[Brijesh Verma]

The declared service u/s 66E(i) states:

service portion in an activity wherein goods, being food or any other article of human consumption or any drink (whether or not intoxicating) is supplied in any manner as a part of the activity.

Hence, the first and foremost condition here is that there should be an activity which comprises of supplying food or drink along with any other act which tantamounts to execution of a service. It is only on fulfillment of both these conditions that it will amount to a declared service.

As far as sale of items on MRP is concerned, the same should not be subjected to tax based on the D.O.F.No.334/3/2011-TRU

AI Summary

Declared service on supply of food or drink: service tax applies only if a service activity exists; MRP-packaged goods excluded.
The declared service under section 66E(i) requires supply of food or drink together with an act constituting a service; simple sale of MRP-labelled packaged goods is treated as sale of goods and not subject to service tax, and in mixed transactions the service portion alone may be taxable while MRP-packaged items remain excluded.