levy of service tax on non Air Conditioned eating joint/canteen in factory.

[vinay wakde]

Ours is a public limited company.  The Canteen (outdoor Catering service) facility is provided within the  factory premises to our workers/staff.  The eating joint/ Canteen is non Air-conditioned.   From 1^st April, 2013 places having air-conditioning facility shall be liable to Service Tax. However, restaurants which are in open air or garden or on terrace where no air-conditioning is available should not be charging service tax.

Kindly let us know whether no service tax shall be leviable on Canteen (outdoor catering service)facility provided by the service provider w.e.f. 01/04/2013 onwards, as the place of canteen is non A.C. or Service tax will be levied only 40 percent of the total bill assuming that 60 percent goes in the cost of food sold.

Regards,

VINAY

[YAGAY andSUN]

You duly fall under the Outdoor Catering Taxable Service not under the Resturant Services.

AI Summary

Outdoor catering classification triggers service tax liability for factory canteens even when premises are non air conditioned. Factory canteens serving workers within factory premises are classified as Outdoor Catering Taxable Service, not Restaurant Services, and thus the canteen's food service receipts fall within the taxable ambit of outdoor catering irrespective of the premises being non air conditioned.