Question – We’ve got obtained contract from an organization for operating two canteens. We put together meals and serve to staff of firm. The corporate has one AC canteen which is below Factories Act as firm employs greater than 250 staff. Firm has one other non AC canteen in one other unit, the place staff are lower than 250 and isn’t below Factories Act. The corporate is of the view that service tax shouldn’t be chargeable by us to them in each the circumstances. Nevertheless, division is taking a view that our providers are ‘out of doors catering providers’ and we’re liable to pay service tax on 60% of worth. Reply – Part 66E(i) of Finance Act, 1994 defines following as ‘declared service’ – Service portion in an exercise whereby items, being meals or some other article of human consumption or any drink (whether or not or not intoxicating) is equipped in any method as part of the exercise. Exemption to providers supplied in eating places with out air con or central heating – Providers supplied in relation to serving of meals or drinks by a restaurant, consuming joint or a large number, apart from these having the ability of air-conditioning or central air-heating in any a part of the institution, at any time in the course of the yr, are exempt from service tax – Sr No.19 of Notification No. 25/2012-ST dated 20-6-2012 w.e.f. 1-7-2012 as amended w.e.f. 1-Four-2013. Canteen is an ‘consuming joint’ or a ‘mess’. Be aware that service supplied by an consuming joint or a large number are exempt from service tax. Who’s operating or managing that consuming joint or mess shouldn’t be related for function of this exemption. Exemption to meals and drinks served in canteen in manufacturing facility – Providers supplied in relation to serving of meals or drinks by a canteen maintained in manufacturing facility coated below Factories Act having facility of air-conditioning or central air heating at any time in the course of the yr is exempt from service tax w.e.f. 22-10-2013 – Sr No. 19A of Notification No. 25/2012-ST dated 20-6-2012 inserted w.e.f. 22-10-2013. Be aware that service supplied by a canteen are exempt from service tax. Who’s operating or managing that consuming joint or mess shouldn’t be related for function of this exemption. The notification doesn’t say ‘canteen run by firm’ or any such related time period. Definition of outside caterer doesn’t exist after 1-7-2012 – The time period ‘out of doors catering’ has not been outlined in valuation guidelines or anyplace else. The sooner definition of ‘out of doors catering’ shouldn’t be efficient from 1-7-2012 – see proviso inserted at finish of part 65(105) of Finance Act, 1994 and at finish of part 66 of Finance Act, 1994. These amended provisions have been notified videNotification No. 20/2012-ST dated 5-6-2012 andNotification No. 22/2012-ST dated 5-6-2012.