hostel service is chargeable or not

[khan mohd]

I am running a hostel service since 2012 onwards with mess facility. will u please confirm me weither i am liable to pay service tax on that period of 2015 to 2016.

[KASTURI SETHI]

Both services (Renting of Immovable Property and Catering Services) are not naturally bundled. These are to be treated as separately. If renting out is less than Rs.one thousand per day per unit, it is fully exempted. Regarding catering, you can avail threshold exemption limit of Rs.ten lacs. The value of wholly exempted services are to be excluded while arriving at threshold exemption limit. See Notification No.33/12-ST dated 20.6.12 as amended.If any doubt, post your further query here.

[Ganeshan Kalyani]

Sri Kasturi Sir, you have correctly replied. Thanks.

AI Summary

Hostel service taxation: rental and catering treated separately; exemptions affect threshold calculation for service tax liability.
Hostel accommodation and mess/catering are treated as separate services: Renting of Immovable Property is fully exempt where the daily per unit rent is below the prescribed exempt threshold, and Catering Services are subject to a separate threshold exemption. The value of wholly exempt rental services must be excluded when computing whether catering receipts exceed the threshold for service tax liability.