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Service tax on ta/ hd

CA Kamal Aggarwal (Accounts Manager) (78 Points)

19 June 2013

I have a query. whether service tax is applicable on sales made by restaurants on account of Take Away/ Home Delivery ? If yes, can anybody provide me some notification/ circular.

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Sumit Grover (Chartered Accountant ) (3652 Points)
Replied 19 June 2013

S.No. 19 of Notification no. 25/2012(amended by 03/2013) reads out as follows:

"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 airconditioning or central air-heating in any part of the establishment, at any time during the year;”

In my opinion, on home delivery, no service tax should be levied, since the word used is---"Serving", whereas in case of home delivery, it is just the supply of food and not serve.

However, on a safer side, majority of restaurants are charging service tax even on home delivery.

Because, you never know, when the govt. may insert a retrospective explanation in the aforesaid provision.

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