Can vat & service tax both charged on single bill???

Dear Prateek

There is an element of service in the catering business. This has been recognised under service tax law. There is also an element of supply of food which is chargable to VAT. The price paid and billed by a caterer is a lump sum price which includes the supply and service components.

In both the VAT and Service Tax Laws, such caterers are given an option for payment of tax based on certain percentage of the net value. This is popularly known as Composition Rate.

In your case the caterer has rightly charged VAT and Service Tax at the Composition Rates.

While charging the Tax at the Composition of abated rates, the caterer becomes ineligible for availing VAT Input Credit and Cenvat Credit under the VAT and Service Tax Law respectively.

now my question is can service provider charged service tax and vat on an single value. eventhough he is not bifurcated service and goods amount in bill.

as per my opnion if he not bifurcated service and goods amount in bill than how both service tax and vat charged on single value.

Dear Prateek

I feel that the contractor has charged the VAT and Service Tax on the same value because they are at Composition Rate.

If the contractor had bifurcated the amount of Food and Service, then he could very well have paid the applicable VAT and Service Tax thereon.

The contractor has opted for Composition Rate just because he is not able to bifurcate the value of service and food.

Hope the matter is clear.