TaxTMI 
TaxTMI 
Dear Sir,
We are having pharmaceutical manufacturing industry and providing the Tea/Snacks to our staff through out side agency. Whether will it comes under service tax net? Pl provide your openion.
Achyut Kale
Service Tax on service provided by out caterer
10 Feb 2011 
3 Replies 
1620 Views Asked by
Outdoor catering services may attract service tax with abatement; recipients can claim Cenvat Credit where applicable.
Whether provision of tea and snacks through an external agency attracts service tax depends on the supplier's activity: if no consideration is received from employees there may be no taxable receipt, but catering supplied by an external provider at premises other than the caterer's own qualifies as Outdoor Catering and is taxable with an available abatement. The external agency, as service provider, must satisfy registration and tax collection obligations when turnover thresholds are met, and the employer, as recipient, may claim Cenvat Credit on the service. (AI Summary)
Whether provision of tea and snacks through an external agency attracts service tax depends on the supplier's activity: if no consideration is received from employees there may be no taxable receipt, but catering supplied by an external provider at premises other than the caterer's own qualifies as Outdoor Catering and is taxable with an available abatement. The external agency, as service provider, must satisfy registration and tax collection obligations when turnover thresholds are met, and the employer, as recipient, may claim Cenvat Credit on the service. (AI Summary)