Service Tax Levy on Restaurant

[Srivatsan Krishnamachari]

Dear Learned Friends,

In 2013 Kerala High court in an Order held the Service Tax levy on Restaurant as "unconstitutional". Kindly clarify whether this order of Kerala High court's Order or similar orders from other High courts have been overruled by the Apex court.

Regards,

K.S

AI Summary

Service tax on restaurant services faces conflicting high court views, impacting VAT allocation and restaurant billing compliance.
Conflict among High Courts exists on the validity and application of service tax to restaurant services, generating uncertainty. One High Court held the levy unconstitutional while another upheld it. Separately, judicial interpretation and an administrative valuation rule allocate billed value between service and material components, directing service tax on the service portion and VAT on the remaining portion; common billing practices charging VAT on the full bill may therefore be inconsistent with that allocation.