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Service tax on restaurant bills

Queries 1676 views 1 replies

Suraj S

Audit Executive

335 Points Joined July 2010

Dear CCI'ites,

Please tell me what is the position of a restaurant from 01.04.2012 when the negative list of services has been implemented. One of my clients is running a hotel which does not have the facility of Air Conditioner. Now, does this hotel have to charge service tax on food served in the hotel from 01.04.2012. I am asking this query because this hotel was exempted from payment of Service Tax in the Previous Year as there was no Air Conditioner. But, now as negative list has been implemented, does it also cover the hotels not having Air Conditioner.

Thanks in advance.

Replies (1)

Pinky Agarwal

Chartered Accountant

426 Points Joined August 2010

As per notification no. 12/2012 - ST dated 17th March, 2012 "Services provided in relation to serving of food or beverages by a restaurant, eating joint or a mess, other than those having the facility of air-conditioning or central air-heating in any part of the establishment, at any time during the year, and which has a licence to serve alcoholic beverages" are exempt from service tax...

Hence, as there is no Airconditioner in your hotel, you are exempt from service tax..

Regards,

Pinky Agarwal.