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The Hotel Accommodation & Restaurant services provided to the employees & guests of SEZ units, cannot be treated as supply of goods & services to SEZ units, taxable accordingly.

Shanti Prime Publication Pvt. Ltd.

Place of Supply — The Applicant is engaged in hotel business, having hotel "Fairfield Marriott" and provides hotel accommodation & restaurant services. They are providing services to the employees & guests of some of the units in SEZ, Belgavi, in addition to the regular customers. They are charging SGST & CGST at the applicable rates. The SEZ units contended that the services are being supplied/rendered to sez unit only and hence rate of GST is NIL as per provisions of section 16(1)(b) of IGST Act' 2017. Therefore the applicant filed this instant application seeking advance ruling on the following issue: "Whether the Hotel Accommodation & Restaurant services provided by them, within the premises of the Hotel, to the employees & guests of SEZ units, be treated as supply of goods & services to SEZ units in Karnataka or not?" Authority for Advance Rulings, Karnataka held that:- Since place of provision of services in case of Hotel has been prescribed under the Act 'location of the Hotel' the rendition of services of restaurant, short term accommodation and Banqueting/conferencing cannot be said to have been 'imported or procured' into SEZ Unit/ Developer. The Hotel Accommodation & Restaurant services being provided by the Applicant, within the premises of the Hotel, to the employees & guests of SEZ units, can not be treated as supply of goods & services to SEZ units in Karnataka & hence the intra state supply and are taxable accordingly. [2018] 51 TUD 119 (AAR-KARN)