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The activity of supply of food in canteens of office, factory, hospital, college, industrial unit etc. on contractual basis excepting that supply is not event based or on specific occasions, constitute supply of service attracts 5% GST

Shanti Prime Publication Pvt. Ltd. Levy of GST — GST, 2017 - The applicant has a kitchen in Miyapur, where food is prepared and transported to some software companies where it is again “sold” to the company employees in the dining Hall. The software companies do not have kitchens because of safety reasons, but however, they have dining hall facilities. The Dining Hall/Cafeteria runs on a daily basis. A separate food license is Obtained by us for selling the food in this organization issued by GHMC. The Applicant entity also provides Transport services to a training institute for carting food from one building to another for service/sale. The applicant entity charges them a separate transport charges. Thus, they requested for an advance ruling as regards to the rate of GST to be levied on the activities mentioned at para 1, 2, 3, 4 a, 4 b, 5 and 6 of their above submissions. The Authority for the points raised at s.no. 1, 2, 3, 4(a), 4(b) and 5 held that the activity of supply of food in canteens of office, factory, hospital, college, industrial unit etc. on contractual basis excepting that supply is not event based or on specific occasions, constitute supply of service and taxable at the rate of 2.5% CGST + 2.5% SGST and the supplier is not eligible for the input tax credit as per the condition stipulated therein. Whereas, in respect of point no.6 held that where the applicant provides transport services to a training institute for carting food from one building to another for service/sale and the applicant charges a separate transport charges, the applicant needs to discharge GST on the gross amount (cost of Food + cost of Transportation) at the rate of 18% GST.Prism Hospitality Services (P) Ltd. [2018] 4 TAXLOK.COM 094 (AAR-Telangana)
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