Chargeable meal at lunch hour

CA Raju Kumar Shaw (Service) (79 Points)

01 September 2011  

Dear My Professional Colleague,

 One of my Clients is in their project stage of their Plant, they have arrange the meal at lunch , dinner, Breakfast (morning and Evening) in the plant premises through a contract given to M/s Sodaxo. They are charging Rs. 40 for each Meal and Rs. 12 per Break fast from the company. For Booking such expenses , Company debiting canteen expenses and crediting Sodaxo.

Company in return deducting the same amount from the salary of employee who ever is taking the service of meal or breakfast. For booking such transaction company crediting canteen expenses and debiting Employee.

 What will be the implication of this transaction in the book of accounts from the Income tax view? Kindly give your valuable input on the matter.