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service charges collected

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(Querist)
04 January 2009 service charges collected by restaurants @ 5% on bill amount and the same is distributed amongst employees of the hotel monthly.

Clarify whether the service charges collected attracts service tax
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Jitender

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Jitender (Expert)
04 January 2009 yes it attracts service tax . plz refer case of hotel mela plaza in this regard by cestat.

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