Commissioner of Service Tax-I Vs Bindras Hospitality Service Pvt. Ltd. (CESTAT Mumbai)
Summary: CESTAT Mumbai dismissed the Revenue’s appeal against the order dropping service tax demand on Bindras Hospitality Service Pvt. Ltd. under the taxable category of outdoor catering service. The assessee sold cooked food to employees of a corporate house from counters where point-of-sale/Bradma machines had been installed. The corporate house provided the space for such sales, while the food articles sold by the assessee suffered VAT under the applicable State law. Importantly, the assessee did not separately recover any amount either from the corporate house or its employees towards provision of any service.
The Tribunal observed that the adjudicating authority had specifically found, after considering the factual matrix and statutory provisions, that service tax was not payable on food sold directly by the assessee to consumers. It found no justifiable reason to accept the Revenue’s contention that the activity constituted taxable outdoor catering service under Section 65(24) read with Section 65(76)(a) of the Finance Act, 1994. Accordingly, finding no infirmity in the adjudicating authority’s order, CESTAT upheld the dropping of the proposed service tax demand and dismissed the Revenue’s appeal. Bindras Hospitality Service Bindras Hospitality Service
FULL TEXT OF THE CESTAT ORDER
Revenue is in appeal against the impugned order dated 22.02.2016 passed by the Principal Commissioner of Service Tax, Pune, wherein proposals made in the show cause notice, seeking for confirmation of service tax demand under the taxable category of outdoor catering service were dropped. The adjudicating authority has held that the respondent herein had sold edible foods to employees of the corporate house, who had provided the space and that selling of food articles had suffered VAT levied under the Maharashtra VAT Act. Accordingly, he has held that there was no provision of service in respect of counter sale made by the respondent. It has further been held in the impugned order that no separate charges have been made towards providing any service by the respondent. Revenue has assailed the impugned order on the ground that the activities provided by the respondent are conforming to the definition of taxable service of outdoor catering service, defined under Section 65(24) read with Section 65(76)(a) of the Finance Act, 1994.
2. Heard both sides and perused the records.
3. On examination of the case records, we find that the respondent had installed point of sales machines/Bradma machines at the counters from where the cooked food is sold to the employees of the corporate house and that for selling the food items, the respondent had paid appropriate VAT amount levied under the local state Act. It also transpires that the respondent had not separately claimed any charges either from the corporate or from their employees towards provision of any service. Thus, analyzing the factual matrix of the case and also the statutory provisions, the learned adjudicating authority has recorded specific finding that service tax is not payable on the foods sold by the respondent to its consumers directly. On going through the averments made by Revenue in the appeal memorandum, we do not find any justifiable reason or ground to accept the submissions that service tax liability should be fastened on the respondent for providing the taxable service of outdoor catering service.
4. In view of above, we do not find any infirmity in the impugned order, insofar as it has dropped the proposals in the show cause notice for confirmation of service tax demand under the taxable category of outdoor catering service. Accordingly, the appeal filed by Revenue is dismissed.
(Operative part of the order pronounced in the open court)
