ST Liability in case of outdoor category

[NANDKUMAR SAGWEKAR]

Dear Sir ,

We are manufacturer of Chemicals having 500 employees .As per factories Act we have to

provide the food , tea to our employees. Employees has formed a Co-operative Society .

This society runs a Canteen at Factory premises and raising the bill on monthly basis.

Wheather Society is liable to pay service tax. Monthly billing is Rs. 6 lakhs 

AI Summary

Cooperative Society Running Factory Canteen Deemed 'Outdoor Caterer'; Liable for Service Tax Under Factories Act. A chemical manufacturing company with 500 employees is required by the Factories Act to provide food and tea to its employees. The employees have formed a cooperative society that runs a canteen on the factory premises and bills the company monthly for Rs. 6 lakhs. The discussion addresses whether the society is liable to pay service tax. It is concluded that if the factory provides space for the catering service, the society is considered an 'outdoor caterer' and is liable for service tax. A 50% abatement is available, and Cenvat credit can be claimed on the input service.