Accommodation service

This query is : Resolved

ARUN BHALLA (Querist)
Follow

29 July 2012 if the value of food served in the room is mentioned in a bill along with the room tariff and no separate bill is raised for food whether service tax has to be charged on the value of food also.

eg. a) room tariff Rs. 2000/-
b)Extra bed Rs. 500/-
c) Food served in room Rs. 750/-

on what value the service tax has to be charged

CA Suresh Jain

CA Suresh Jain (Expert)
Follow

30 July 2012 Dear Mr. Arun,

Entry Sr. No. 18 of Mega exemption notification of Service Tax Nol 25/2012 dated 20-06.2012 Service Tax read is as under :-

18. Services by way of renting of a hotel, inn, guest house, club, campsite or other commercial places meant for residential or lodging purposes, having declared tariff of a unit of accommodation below rupees one thousand per day or equivalent;

Accordingly, the room rent and extra bed rent are taxable;

As per Entry Sr. No. 19 of Mega exemption notification of Service Tax ibid which Tax read is as under, service of supply of food in the Hotel room is not exempted nor it is in Negative list :-

19. Services provided in relation to serving of food or beverages by a restaurant, eating joint or a mess, other than those having (i) the facility of air-conditioning or central air-heating in any part of the establishment, at any time during the year, and (ii) a licence to serve alcoholic beverages;

And there for the food served in Hotel room is a taxable service and the same will be taxed as per the provisions of rule 2C of the Service Tax (Determination of Value) Rules as under :-

“2C. Determination of value of service portion involved in supply of food or any other article of human consumption or any drink in a restaurant or as outdoor catering.- Subject to the provisions of section 67, the value of service portion, in an activity wherein goods being food or any other article of human consumption or any drink (whether or not intoxicating) is supplied in any manner as a part of the activity at a restaurant or as outdoor catering, shall be the specified percentage of the total amount charged for such supply, in terms of the following Table, namely:-
Table
Sl.
No. Description Percentage of the total amount
(1) (2) (3)
1. Service portion in an activity wherein goods, being food or any other article of human consumption or any drink(whether or not intoxicating) is supplied in any manner as a part of the activity, at a restaurant 40
2. Service portion in outdoor catering wherein goods, being food or any other article of human consumption or any drink(whether or not intoxicating) is supplied in any manner as a part of such outdoor catering 60

Regards,

Sureshjain.nj@gmail.com

ARUN BHALLA

ARUN BHALLA (Querist)
Follow

30 July 2012 sir thanks for the reply,,,

now if i raise 2 invoices
1.invoice for the food
2.invoice for tariff and extra bed

then what shall be the scenario.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now