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TMI Blog2011 (4) TMI 911X X X X Extracts X X X X X X X X Extracts X X X X ..... of food etc., which would constitute sale. Hence, the value of the food articles are liable for sales tax which the State Government is liable to impose. The other part of out door catering is the service rendered by the assessee in bringing the food articles to a place designated by the client. The service so rendered by the assessee, which also includes the cost of transporting the food articles constitutes service. Therefore, to this extent alone, the assessee is liable for service tax and not for the entire cost received from the Airlines. Hence, there has to be a bifurcation with regard to the sale of goods and the service provided - Decided in favour of the assessee. - CEA NO. 35-36 OF 2010 - - - Dated:- 20-4-2011 - N. KUMAR AND ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich the service tax liability works out to Rs. 82,52,869. The assessee however paid a sum of Rs. 26,20,702 only. Hence the balance of amount of Rs. 56,32,167 was sought to be recovered by them. Accordingly a show cause notice was issued. 4. The assessee contended that they are eligible for exemption under Notification No. 12/2003, dated 20-6-2003 in respect of the value of food and beverages served to the Airlines on payment of VAT. That in a transaction of sale of food, the element of service in connection with catering was only to the extent of handling and loading of food and beverages on the aircraft. Hence they had paid service tax to that extent. The assessing authority came to the conclusion that in terms of section 67 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m as out door caterer. 6. The identical question with regard to the liability of the assessee towards service tax so far as service rendered by them with regard to the out door catering is concerned came up for consideration before the Division Bench of this Court in Writ Appeal Nos. 671 to 726/2011 which were disposed of by the order dated 18-4-2011. By a detailed consideration and relying on various Supreme Court Judgments, the Division Bench of this Court came to the conclusion that the out door catering contract is a contract for service by virtue of sub-clause (f) of clause 29(a) of Article 366 of the Constitution of India which has to be treated as composite contract and the State Legislature is competent to levy the sales tax on th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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