Dated : 15.11.2013
Trade Notice No.04/2013-Service Tax/SH
Dated, Shillong the 13th November, 2013
Attention of the members of Trade Industry and all others
concerned are hereby invited to the Circular No.173/8/2013-ST dated 7th
October, 2013 issued under F.No.334/3/2013-TRU by the Technical Officer,
TRU of Central Board of Excise & Customs, New Delhi on clarification
regarding Restaurant Service. The following clarification has been
As part of the Budget exercise 2013, the
exemption for services provided by specified restaurants extended vide
serial number 19 of Notification 25/2012-ST was modified vide para 1 (iii)
of Notification 3/2013-ST. This has become operational on the 1st
of April, 2013.
2. In this context, representations have been
received. On the doubts and questions raised therein clarifications
are as follows:
In a complex where air conditioned as well as non-air conditioned
restaurants are operational but food is sourced from the common
kitchen, will service tax arise in the non-air conditioned
Services provided in relation to serving of food
or beverages by a restaurant, eating joint or mess, having the
facility of air conditioning or central air heating in any part of
the establishment, at any time during the year (hereinafter referred
as ‘specified restaurant’) attracts service tax. In a complex, if
there is more than one restaurant, which are clearly demarcated and
separately named but food is sourced from a common kitchen, only the
service provided in the specified restaurant is liable to service
tax and service provided in a non air-conditioned or non centrally
air- heated restaurant will not be liable to service tax. In such
cases, service provided in the non air-conditioned / non-centrally
air-heated restaurant will be treated as exempted service and credit
entitlement will be as per the Cenvat Credit Rules.
In a hotel, if services are provided by a specified restaurant in
other areas e.g. swimming pool or an open area attached to the
restaurant, will service tax arise?
Yes. Services provided by specified restaurant in
other areas of the hotel are liable to service tax.
Whether service tax is leviable on goods sold on MRP basis across
the counter as part of the Bill/invoice.
If goods are sold on MRP basis (fixed under the Legal Metrology Act)
they have to be excluded from total amount for the determination of
value of service portion.
Board’s Circular No.173/8/2013-ST issued vides
F.No.334/3/2013-TRU dated 7th October, 2013.
care has been taken to reproduce the text in its original form, in case of
any inadvertent mistake, the above mentioned Circular may be referred to.