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OUTDOOR CATERING

Ankit Jalan (ARTICLE ASSISTANT) (28 Points)

21 March 2011

I want to know the chargeability under Service Tax & VAT in case of business of outdoor catering of food.

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Pankaj Arora (Learner) (3134 Points)
Replied 21 March 2011

Indian Service Tax

Outdoor Catering Services

Effective Date: 10/09/2004. Authority: Finance (No.2) Act, 2004.

Rate of Service Tax: 10% - Cess 2% of 10% = 0.2. Total ST = 10.2%.

Definitions: "caterer"means any person who supplies, either directly or indirectly, any food, edible preparations, alcoholic or non-alcoholic beverages or crockery and similar articles or accoutrements for any purpose or occasion; [Section 65 (24)].

"Outdoor Caterer" means a caterer engaged in providing services in connection with catering at a place other than his own, [Section 65 (76a)]

Taxable service: Taxable service means any service provided to a client, by an outdoor caterer, [Section 65 (105) (zzt)]

Value of taxable service: Gross amount

Exemptions: See Notification No. 18/2004-ST, dt. 10/9/2004 at the end of the Chapter of "Airport Services".

Catering in hotels, restaurants, trains, inhouse services.

Person liable to pay: Outdoor Catering Service provider

Head of Account: To be issued.

Notifications

Exemption

[Notification No. 18/2004-ST,. dt. 10/9/2004]

For full text see under "Airport Services".

Exemption to catering service provided on a railway train

[Notification No. 19/2004-ST, dt. 10/9/2004]

In exercise of the powers conferred by sub-section (1) of Section 93 of the Finance Act, 1994 (32 of 1994), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts taxable service provided by an outdoor caterer to a client in relation to catering service provided on a railway train by such caterer, from the whole of service tax leviable thereon under Section 66 of the said Act.

[NotificationNo.20/2004-ST,dt.10/9/2004]

In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts taxable service provided by an outdoor caterer from so much of the service tax leviable thereon under Section 66 of the said Act, as is in excess of the amount of service tax calculated on a value which is equivalent to fifty per cent. of the gross amount charged from the client by such caterer for the services provided in relation to catering

Provided that the said exemption shall apply in such cases where -

Such outdoor caterer also provides food and the invoice, bill or challan issued for this purpose indicates that it is inclusive of charges for supply of food; and
No credit of duty paid on inputs or capital goods has been taken under the provisions of the Cenvat Credit Rules, 2004; and
Such outdoor caterer has not availed the benefit under the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 12/2003-Service Tax, dated the 20th June, 2003 [G.S.R. 503(E),dated the 20th June, 2003]

Explanation: For the purposes of this notification, the _expression "food". means a substantial and satisfying meal.

[Notification No. 21/2004-ST, dt. 10/9/2004]

In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable service provided by an outdoor caterer to a client for services in relation to catering by such caterer if such caterer is located within the premises of any academic institution or medical establishment and is providing such services only within such premises, from the whole of service tax leviable thereon under section 66 of the said Act.