By Puloma Dalal, Jayesh Gogri, Chartered Accountants
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Valuation – Rules of classification- Mandap Keeper service – room charges of hotel accommodation service not to be included – Hotel accommodation and Mandap Keeper are distinct services.
Facts:
The Appellants provided mandap keeper’s services and convention services and discharged service tax on banquet charges, banquet sundries and banquet food. The Appellants, however, did not discharge service tax on the value of room charges booked by them for the purpose of marriage, conference, meetings etc. The department contended to include such room charges in the value of mandap keeper services.
Held:
Relying on the decision of Merwara Estates vs. C.C.E., Jaipur 2009 (16) STR 268 (Tri.-Del.), the Hon. Tribunal held that renting of hotel rooms cannot be held to be covered under the definition of mandap keeper services especially when the hotel has an identity, responsibility and function distinguishable from the mandap. The Tribunal further observed that the activity of giving hotel rooms on rent to customers, who might organise functions in the hotel, was different from that of the activity of a mandap keeper and that the definition of mandap keeper did not cover temporary accommodation of hotel rooms or boarding or temporary residence. Further, the functions were also not held in hotel rooms which were used for stay.
