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2023 (12) TMI 909 - AT - Service TaxLevy of Service Tax - Restaurant Service - rendering Mandap Keeper Service, Cab Operator Service and Business Auxiliary Service - Department was of the view that the respondent was liable for registration and payment of Service Tax on ‘Restaurant Services’ provided in respect of food and beverages, including alcoholic beverages or both, in their premises - exemption under Notification No. 25/2012-ST dated 20.06.2012. HELD THAT:- As the restaurants though located in the premises of Hotel Sangam in Trichy and Thanjavur, they are clearly demarcated from the permit room and these restaurants are separately named and the service activities in the restaurants are not linked to the service activities in the permit room or bar. As the restaurants located in the premises of Hotel Sangam in Trichy and Thanjavur, do not fulfil the requirement of having a licence to serve alcoholic beverages, the services provided in the restaurant does not come under the ambit of ‘Restaurant Services’. The basic premise of the Show Cause Notice for demanding Service Tax from the appellant is that the services from the restaurant are located within the premises of the hotel and the hotel has a licence to serve liquor, hence, the restaurant fulfills the requirements under the category of ‘Restaurant Services’ is not legally correct and this inconsistent interpretation has to be discarded. The term establishment as figuring in the definition under Section 65(105)(zzzzv) has been referred to as the ‘Hotel’ in whose premises the restaurant is located and not for the ‘Restaurant’. As such, the restaurants located in the appellant’s premises both at Trichy and Thanjavur have not satisfied one of the conditions of serving alcoholic beverages and so the Service Tax liability cannot be fastened in respect of restaurant service on the appellant. As held by the Hon’ble Supreme Court in the case of COMMISSIONER OF CENTRAL EXCISE, BOLPUR VERSUS M/S RATAN MELTING & WIRE INDUSTRIES [2008 (10) TMI 5 - SUPREME COURT], the Department Circulars and instructions are binding on the Revenue authorities under the respective statutes and as such, in view of the express clarification issued vide Circular No. 139/8/2011-TRU dated 10.05.2011, the impugned order could not have been challenged by filing an appeal by the Department as in doing so, it goes against the Circular issued by the Board. The contentions advanced on behalf of the Department are without substance as the Circulars / Notifications ibid do not run contrary to the provisions of the Act - there is no reason to differ with the Order-in-Original No. 06/2014- ST dated 20.02.2014 passed by Commissioner of Central Excise and Service Tax, Trichy - As the demand cannot sustain, there is no need to discuss about the invocation of extended period in this appeal. The impugned order does not call for any interference - the Department’s appeal stands dismissed.
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