Recently we had a conference in one of the Hotel, where our participants stayed as well as we had our conference in one of the halls provided by the Hotel. For conference hotel provided with the hall, projector, PA system and, Lunch. Our finance department wants to deduct Tax on the conference charges which includes lunch under section 194C.
In our view TDS is not applicable under section 194C as food provided by the hotel in the conference hall does not amount to catering services.
In terms of the Department's circular serving of food in a Restaurant does not come under the purview of Section 194 C. and only because they have provided food in aseperate room does not amount to Catering services or carrying out of work as the food is cooked in the same kitchen and served by the same waitors.
Also it was held in East India Hotels V. Central Board of direct taxes by Bombay high court that facilities provided by the hotel do not constitute work hence TDS is not applicable.