DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)
Consumer Complaint No.187 of 2017
Date of institution: 08.03.2017 Date of decision : 05.07.2018
Diksha daughter of Mahesh Sharma, resident of House No.HM-187, First Floor, Phase-4, Mohali.
…….Complainant
Versus
Pizza Hut, SCO 10, Phase-5, Mohali through its Incharge/MD/ Manager.
……..Opposite Party
Application for rejection of the complaint.
Quorum: Shri G.K. Dhir, President,
Shri Amrinder Singh Sidhu,
Mrs. Natasha Chopra, Member.
Present: Shri Kulwinder Singh, counsel for the complainant.
Shri Manish Tiwari, Assistant Manager (Finance) of OP.
Order by :- Shri G.K. Dhir, President.
Order
Application for rejection of the complaint filed by OP before filing written statement, by claiming that Devyani International Ltd. is a company incorporated under the Companies Act, 1956. OP is an archtype embellishment in the Food and Beverage Industry of the country and holds impeccable reputation. OP Company has 500 + outlets across Indian Sub Continent, Nepal and Nigeria. Complaint filed by complainant is alleged to be not maintainable because of manipulations and misrepresentations as well as concealment of material facts. Moreover, it is claimed that complaint has been filed for grossly abusing process of law. As per allegations leveled in the complaint, OP issued retail invoice bill for an amount of Rs.336/- including Value Added Tax @ 14.3% and service tax @ 6%. In the complaint, it is also mentioned that transaction in question was related to delivery of food per se and as such no element of service was involved in the transaction, due to which levy of service tax claimed to be bad. Complainant relied on letter dated 13.08.2015 issued by office of Deputy Commissioner, Central Excise & Service Tax Division, SCO 48-49, Sector 17-A, Chandigarh. That letter had already been declared as withdrawn ab initio by issue of fresh letter dated 09.09.2015 by same authority. By virtue of Section 66B of Finance Act, 1994, as amended with Rule 2C of the Service Tax (Determination of Value) Rules, 2006 (as amended by Notification No.24/2012 dated 06.06.2012), service tax is applicable on the activity of a restaurant. Provisions of Finance Act and the rules framed thereunder cannot be amended by issue of a letter by Deputy Commissioner, Central Excise & Service Tax Division. In view of this, it is claimed that there is no deficiency in service on part of OP. Moreover, it is claimed that allegations do not bring the substance within the definition of complaint defined in Section 2 (c) of the Consumer Protection Act, 1986. Complaint is filed without any cause of action and as such prayer made for rejection of the complaint.
2. In reply, it is claimed that service tax has been charged on the delivered item, despite the fact that service charge not claimable on take away or on home delivered items. Withdrawal of letter dated 13.08.2015 by Service Tax Department does not allow the OP to collect service tax, more so when item was delivered at home and no service was given for which the OP had charged service tax. In the notification dated 06.02.2012, mention regarding charging of service tax is not made. So by claiming that service tax is not applicable on the take away item, prayer made for dismissal of the complaint.
3. Arguments on this application were heard.
4. Perusal of complaint reveals that on ordering of Pizza or delivery through telephonic call dated 09.02.2017, OP issued retail invoice bill for an amount of Rs.336/- including VAT amount of Rs.39.90 N.P. @ 14.3% plus service tax amount of Rs.16.74 N.P. @ 6%. Claim of complainant is that OP is not authorised to demand service tax because complainant has not visited OP shop. In view of these allegations leveled in the complaint itself, it is made out that complainant availed additional service of home delivery of Pizza item from OP. There is nothing in the complaint or in the supporting affidavit or the documents produced by complainant to show that home delivery service to be rendered by OP free of cost. If such allegations are not there in the complaint or in any other material produced by complainant, then it has to be held that home delivery service availed by complainant for enjoying Pizza at home. As and when home delivery services are provided by any concern, then certainly it is bound to spend something by way of engaging carrier or like that. In view of this additional burden to be borne by OP for home delivery food product item, certainly OP bound to spend extra amount than that of the amount chargeable for the sold product/food item.
5. Counsel for complainant has placed reliance on letter dated 13.08.2015 issued by office of Deputy Commissioner, Central Excise & Service Tax Division, Sector 17, Chandigarh for claiming that service tax can be levied only if there is an element of service involved. That element of service is typically involved when the food is served in a restaurant. In this letter itself, it is mentioned that no amount is chargeable on free delivery of food services. However, this letter dated 13.08.2015 has been subsequently withdrawn by same authority vide letter dated 09.09.2015, copy of which is produced with application for rejection of the complaint. If the earlier letter dated 13.08.2015 has been withdrawn by same authority subsequently on 09.09.2015, then certainly complainant for the purchase made through home delivery service on 09.02.2017 cannot avail benefit of letter dated 13.08.2015. So it has to be taken as if there is no letter issued by any authority regarding charging or non charging of service tax on home delivery services. As per Notification No.24/2012 published in Gazette of India Extra Ordinary Part-II, Section 3, Sub Section (i) under provisions of Finance Act, 1994, determination of value of service portion involved in supply of food or any other article of human consumption or any drink in a restaurant or as outdoor catering is governed by Clause 2C of that notification. Copy of that notification issued by Central Board of Excise & Customs is enclosed with the application by OP.
6. After going through Clause-2C of Notification dated 24/2012 referred above, it is made out that subject to provisions of Section 67, the value of service portion, in an activity wherein goods being food or any other article of human consumption or any drink (whether or not intoxicating) is supplied in any manner as a part of the activity at a restaurant or as outdoor catering, shall be the specified percentage of total amount charged for such supply. Percentage of the claimable amount is 60 for services provided for home delivery of food articles. So terms of the above said notification does provide for determination of value of service portion. Being so, the provided service regarding delivery of Pizza at home is liable for determination of value of service portion. When such determination of value of service potion to take place as per rules called as Service Tax (Determination of Value) Second Amendment Rules, 2012, which came in force w.e.f. 01.07.2012, then certainly the service tax is payable after coming into force of GST. So if OP charged service tax on the value of service provided by way of home delivery of food article, then no illegality committed by it, more so when the home delivery services not to be rendered free of cost virtually by OP, as held above. So act of charging of service tax by OP does not amount to deficiency in service. Rather the service tax has been charged in accordance with the provisions of above said notification and the rules and as such certainly the complaint being misconceived, merits dismissal by way of acceptance of application for rejection of complaint.
7. As a sequel of above discussion, application for dismissal of complaint allowed and accordingly the complaint is dismissed. Certified copies of the order be supplied to the parties free of cost as per rules. File be indexed and consigned to record room.
Announced
July 05, 2018.
(G.K. Dhir)
President
(Amrinder Singh Sidhu)
Member
(Mrs. Natasha Chopra)
Member
