Food Products prepared and served at Hotels/Restaurants or retail outlets - Regarding. - Central Excise - F. No. 332/09/2011-TRU

Instruction Government of India Ministry of Finance (Department of Revenue) Central Board of Excise Customs, New Delhi dated 27-7-2011 Subject : Food Products prepared and served at Hotels/Restaurants or retail outlets - Regarding. Representations have been received from trade and Industry seeking clarification on the leviability of excise duty on food preparations, including foods preparations containing meat which are prepared and/or served in a hotel/restaurant. Clarification has also been sought about the applicability of the levy to food preparations that are prepared or served in retail outlets as takeaways as in the case of pizzas, pasta etc. It has been stated that excise duty is sought to be charged on such items in view of the omission of entry number 13 and 17 vide notification number 23/2011 dated 24-3-2011 in Notification No. 3/2006, dated 1-3-2006. 2. The matter has been examined. As part of the proposals contained in the Budget for 2011-12, a nominal excise duty of 1% has been imposed on 130 items which were hitherto exempt from excise duty or chargeable to Nil rate of duty. The excise duty exemptions available to food preparations falling under chapter 16 and 19 were withdrawn and were subject to levy of 1% without the facility of Cenvat credit. However it was not the intention of the Government to charge excise duty on food preparations, including those containing meat, which are prepared and/or served in a hotel, restaurant or retail outlet. It was also not the intention to charge to duty such food preparations prepared in hotels, restaurants or retail outlets and carried as takeaway for consumption outside. 3. Accordingly, Notification No. 37/2011-Central Excise dated 25th July, 2011 has been issued exempting foods preparations including those containing meat, which are prepared and served in a hotel, restaurant or retail outlet including such preparation provided as takeaways. An Explanation has also been inserted vide Notification no. 36/2011-Central Excise dated 25th July, 2011 in Notification No. 23/2011-C.E., dated 24th March, 2011 clarifying the above position in exercise of powers conferred by Section 5A(2A) of the Central Excise Act, 1944 . This would clarify the intention of the Government for the past, that is, from the date of coming into force of the levy. 4. The above position may be brought to the notice of Commissioners under your charge and pending disputes, if any, may be decided accordingly. [F. No. 332/09/2011-TRU]