Add extra cheese to your order

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The Madras High Court has ruled that service tax is not applicable on ‘”take-away” or ‘parcel’ orders collected from restaurants or eateries. The foodie’s wallet is swollen with the delight of those precious savings that restaurants had no business to charge in any case.

Restaurant service, by definition, comprises all non-food attributes of a restaurant including seating, air conditioning, service at the table, live music, and enhanced hospitality. These attributes are absent in the case of a take-away order. In fact, service tax services have been restricted to service in air-conditioned restaurants only.

It is pertinent that even during the pre-covid times, restaurants that offered both dine-in and take-away had a separate counter for the latter and these did not even have an air conditioner, clearly not giving any service for which, the consumer would dig their pockets and pay.

With the implementation of GST in 2017, service tax was phased out. However, on top of GST, the levying service charge was left to the discretion of the restaurant until this order came in.

While consumers celebrate, it will also turn out to be a welcome step for the hospitality sector to revive, given that these savings will propel more people to ditch their kitchens to satiate their cravings for restaurant food.

India needs to spend to spur the economy. More frequent orders will lead to more business for the hospitality sector that is barely managing to stand on its feet.

In addition, it is only logical for take-aways to be more cost-effective than eating out during the pandemic. Social distancing is an obvious advantage too.

The savings must be celebrated, but remember to take them away.