Service tax on canteen

[Yatin Bhopi]

We are manufacturer and having Non-AC canteen in factory (not mandatory as factories act). All necessary arrangement for cooking food  i.e. gas, grains, vegetables, pans etc. provided by company upto Rs. 15000 per month. Any excess to this is contributed by employees. Canteen service provider only arrange for cooking food and serving the food in canteen. He charged for manpower supply i.e on 25 percent of value. Whether his billing for man. supply is correct? Or  his service is cover under Sr. No 19 of Not. No 25/2012 service tax is exempt? Pl. guide

[DR.MARIAPPAN GOVINDARAJAN]

Dear Sir,

The billing done by the canteen service provider is correct.  Sl. No. 19 of 25/2012 is not applicable in this case since he provides only manpower for the purposes of canteen.   

Regards,

M. Govindarajan

AI Summary

Manufacturer's Canteen Manpower Supply Charge Confirmed; No Exemption Under Notification No. 25/2012, Sr. No. 19. A manufacturer with a non-AC canteen in their factory, which is not mandated by the Factories Act, provides necessary cooking supplies up to Rs. 15,000 monthly, with employees covering any excess costs. The canteen service provider charges for manpower supply at 25% of the value. The query concerns whether this billing is correct or exempt under Sr. No. 19 of Notification No. 25/2012 on service tax. The response clarifies that the billing is correct, and the exemption does not apply since the provider only supplies manpower for the canteen.