Related to government sector exemption

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Querist : Anonymous

Querist : Anonymous (Querist)

29 January 2016 Hi,

This is a tax query regarding JSSK scheme( Janani shishu suraksha karyakaram) runs under NRHM( National rural health mission). JSSK scheme is providing free health care services to underprivileged pregnant woman and new born child. Free medicines and free diet to pregnant women during stay in government hospitals if they deliver in government hospital. Is diet comes under health care for the purpose of taxes? JSSK is center government sponsored scheme and UNO( UNICEF) is assisting Union of india.
There is provision for hospitals(Government) to outsource diet service to private firms if they do not have food preparation facility in hospital. Government provides rs 100 for full day diet to pregnant woman( ie Breakfast+lunch+dinner). Patient is paying nothing. Hospital pays out of grants received for this purpose.

1. If any government hospital outsource diet service. Is vendor will be charged ST/VAT?
2. If vendor is using his own place and equipments for preparation of food. And he is only delivering food to the patients. Is vendor comes under category of Caterer/dhaba or what?

*Vendor use his own raw material and eqipments for prepration. Selling only to hospital

Warm regards
Rohit

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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29 January 2016 1 No service tax payable in case of non AC hospital.
2 It comes under out door catering service tax payable.

Querist : Anonymous

Querist : Anonymous (Querist)

29 January 2016 Thank you for your quick reply. Its NON-AC government hospital. So tax is payable or not?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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29 January 2016 For non AC govt hospital no tax payable.

Querist : Anonymous

Querist : Anonymous (Querist)

29 January 2016 Thank you very much. Is there any supporting document that We can sumbit as a proof of above said exemption? Needed very urgently.

Querist : Anonymous

Querist : Anonymous (Querist)

29 January 2016 Exempted even if dietary service is outsourced by NON-AC government hospital? Am I correct?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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30 January 2016 You can out source but ask them to prepare in hospital premises and supply which will be exempted.
Supplying food from outside the hospital will be covered under out door catering services on which service tax payable.
Take up the issue with Govt and get exempted. No justification on charging service tax on such supplies to govt hospitals.

Querist : Anonymous

Querist : Anonymous (Querist)

31 January 2016 Sure sir,
I also consulted with chartered accountant. He said it will be considered as purely sale. ST will not be applicable but VAT is applicable. My client is providing us nothing. neither place, nor raw material. We are preparing at our place and supplying.

Querist : Anonymous

Querist : Anonymous (Querist)

31 January 2016 .Health care services are exempted under service tax act. Is diet comes under health care?

Querist : Anonymous

Querist : Anonymous (Querist)

31 January 2016 Public health care services are also exempted under section 25 of service tax act

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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31 January 2016 Health care service is exempted from service tax. Diet supply to patients can be part of health care service exempted from service tax.

Querist : Anonymous

Querist : Anonymous (Querist)

03 February 2016 You are Absolutely correct Sir. Health care includes diet in the view of many chartered accountants as said by you. The thing to decide is, is it exempted even if the service is outsourced byNon Ac government hospital?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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03 February 2016 Diet supply to patients in hospital is part of healthcare service it is exempted even if it is outsourced.

Querist : Anonymous

Querist : Anonymous (Querist)

04 February 2016 Thank you very very very very very very much. Now this question is finally resolved. Thank you Sir

Querist : Anonymous

Querist : Anonymous (Querist)

04 February 2016 Now, For the purpose of Punjab Vat( I know each state has different vat norms) is preparation of food is considered as manufacturing? Tiffin service as provided by us do not come under dhaba, catering/outdoor catering( not using any space of client). So where to be counted? How much vat is ordinarily put in my kind of service. Our prices are very nominal. RS 33.33 for full diet of one time

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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04 February 2016 I have no knowledge on Punjab VAT.

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