restaurant services-threshold exemption limit

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..... restaurant services-threshold exemption limit
Query (Issue) Started By: - sunil mehta Dated:- 1-6-2013 Last Reply Date:- 5-6-2013 Service Tax
Got 2 Replies
Service Tax
As confusion is prevailing even among professional community whether threshold exemption limit for restaurant service provider is rs.10 lacs or rs. 25 lacs? Now, according to me as per Nofn.33/2012 dt.20/06/2012 it is .....

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..... ''aggregate value of taxable services...'' And as per rule 2C of Determination of value service' (sr.no. 1) it is ''service portion in an activity .......'' --40 % of the total amount charged is the service portion.So if the turnover is 25 lacs then 40 % of 25 lacs is rs.10 lacs will be exempted.If turnover exceeds 25 lacs then only service tax is payable for a new service provider. Restaurant se .....

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..... rvices is not subjected to Abatement notfn. no.26/2012.This chapter is governed by rule 2C . Pl. comment on this C.A. Sunil Mehta email-id:[email protected] Reply By sanjeev bajaj: The Reply: I endorse your view fully. Sub Section (4) of section 67 refers the value as may be prescribed. Hence, rules applies for the same although abatement notifications gives option to pay service tax on .....

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..... the value to avoid the litigation in ascertaining the value of services. Hence, value of services will be 40% of invoices issued or required to be issued.unless and until fall under the bundled services. View endorsed. If any person has different opinion, pl come forward. Reply By sarjerao ghadge: The Reply: Sir, The taxable value in the instant case is 40% of gross value ;so when gross valu .....

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..... e is 25 lakhs ;taxable value is 10 lakhs as deduction on cost of food item is essential and service tax is only on the part of service portion.The unit is eligible for 25 lakhs gross value. S.D.GHADGE.
Discussion Forum - Knowledge Sharing .....

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