2014 (9) TMI 251 - AT - Service Tax

Outdoor catering service - appellants are preparing food from its own material at the place given by KHPL. KHPL is providing service which is covered under restaurant service and is paying appropriate service tax on introduction of service tax on restaurant service with effect from 1.5.2011. - Held that - The reading of the provisions shows that outdoor caterer means any person who is undertaking any activity in connection with catering at a place other than his own. The crucial point to be decided in the present case is whether the appellants are serving the food at the place of KHPL or not. The contention of the appellants is that the food is not being served by them rather the same has been served by KHPL. The plea of the appellants that the food is not served by them is not taken into consideration by the adjudicating authority. The contention of the appellants that the food is not served by them requires verification. - matter remitted back for verification of facts and decision afresh. - Decided in favor of assessee.

Issues:
1. Demand of service tax on outdoor catering service.
2. Interpretation of relevant provisions under the Finance Act.
3. Dispute regarding whether the appellant is providing outdoor catering service.

Analysis:
The appellant challenged an adjudication order confirming a demand for service tax on the grounds of providing outdoor catering service without paying the tax. The appellant contended that they supplied food to a hotel under an agreement where the hotel provided necessary equipment for food preparation, and the appellant received a percentage of the sales as consideration. The appellant argued they were not providing catering services to the hotel's customers but only preparing food at the hotel's premises. The Revenue, however, argued that the appellant fulfilled the criteria of a caterer as defined under the Finance Act. The Tribunal noted the definitions under the Finance Act related to outdoor caterers and caterers, emphasizing that an outdoor caterer provides services at a place other than their own. The crucial issue was whether the appellant was serving food at the hotel's place or not. The Tribunal found that the adjudicating authority did not consider the appellant's argument that they did not serve the food themselves, and thus remanded the matter for fresh adjudication to verify this claim.

The Tribunal highlighted the provisions of the Finance Act defining outdoor caterers and caterers, emphasizing the requirement of providing services at a place other than one's own for outdoor catering services to apply. The Tribunal noted the appellant's argument that they only prepared food at the hotel's premises and did not serve it themselves, with the hotel handling the serving and collection of consideration. The Tribunal found merit in the appellant's contention that the issue required verification and that the adjudicating authority should reconsider the matter after affording the appellant an opportunity to be heard. The impugned order was set aside, and the matter was remanded for fresh adjudication.

The Tribunal's decision centered on the interpretation of the provisions of the Finance Act regarding outdoor catering services and caterers. The Tribunal acknowledged the appellant's argument that they were not serving food themselves but only preparing it at the hotel's premises, with the hotel handling the service and collection of consideration. The Tribunal found that this crucial aspect needed further examination and directed the matter to be reconsidered by the adjudicating authority. The Tribunal emphasized the need for a thorough verification of whether the appellant's activities indeed constituted outdoor catering services as defined under the Finance Act, underscoring the importance of providing a fair opportunity for the appellant to present their case during the fresh adjudication process.

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