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2018 (5) TMI 598 - AAR - GSTRate of GST - supply of food on board the trains - Nature of supply - Goods or services - outdoor catering services - composite contract - mixed supply - naturally bundled service - supply of food through food plaza on the railway platform (with A/C)/Food stalls on the railway platform (without A/C) - rate of tax on supply of newspaper - Held that - The applicant has claimed that their supply is a composite supply and hence should be treated as supply of services. However, In view of the nature of supply involving several types of goods and services, it is important to determine whether the said supply is a composite supply or not. It is observed that the various goods and services supplied by the applicant have separate values, no supply is principal supply and various components of supply are not naturally bundled. Accordingly, the contract between IRCTC and the applicant does not appear to be a composite contract for supply of good and services. Hence, Section 7(l)(d) of the CGST Act, 2017 and Point 6 of Schedule II of the said Act are not applicable. Hence, it is not possible to classify the whole contract as supply of services. Supply of food and beverages (cooked/MRP/packed), at defined menu and tariff, by the applicant to IRCTC/passengers on behalf of IRCTC, on board the Rajdhani/Duronto Express trains - Held that - A train is a mode of transport and hence cannot be called as a restaurant, eating joint, mess or canteen etc. and hence catering services provided on-board a train are not covered under S. No. 7 (i) of the said Notifications as claimed by the applicant - The supply of goods i.e. food, bottled water etc. shall be charged to GST on value of goods (excluding the service charges) at applicable rates as pure supply of goods, as the same have no element of service. The supply of newspaper is separately invoiced and hence it shall be at Nil GST under S. No. 120 of Notification No. 2/2017- Central Tax (Rate) dated 28.06.2017 and parallel Notifications of IGST and Delhi GST - the service charges are covered under Service Code (Tariff) 996335 in Group 99633 of heading 9963 of Annexure/Scheme of Classification of Services as catering services in train . The same are covered under S. No. 7 (ix) of Notification No. 11/2017 - Central Tax (Rate) dated 28.06.2017 as amended vide Notification No. 46/2017 - Central Tax (Rate) dated 14.11.17 and parallel Notifications of IGST and Delhi GST. Supply of food and beverages (cooked/MRP/packed) on board the Mail/express trains by the applicant directly to the passengers as per the menu/rates fixed by IRCTC/Railways - Held that - here no element of service is involved and hence the same shall be considered as pure supply of goods and GST shall be charged on individual items at their respective applicable rates - benefit of notifications not allowed. Supply of food and beverages (cooked/MRP/packed) by the applicant to the passengers/general public at the rates fixed by the Indian Railways/IRCTC at food stalls at Railway platforms - Held that - here also, no service element involved and hence the same shall be considered as pure supply of goods and GST shall be charged on individual items at their respective applicable rates - The mere heating/cooling of beverages or similar other services are incidental and minimal required to supply of goods and such supply cannot be called composite supply - benefit of notifications not allowed. Supply of food (Cooked/MRP/Packed) in food plaza - Held that - the relevant document pertaining to details of items supplied, pricing detains, extent of services provided are not submitted. Hence, no ruling can be given in respect of supply from Food Plaza on the Railway Platform. Application disposed off.
Issues Involved:
1. Applicable rate of tax on the supply of food and beverages in various scenarios. 2. Applicable rate of tax on the supply of newspapers. Detailed Analysis: Issue 1: Applicable Rate of Tax on the Supply of Food and Beverages A. Supply of Food through the Food Plaza/Food Stalls on the Railway Platform: - Applicant's View: The supply of food from the Food Plaza/Food Stall falls under the category of services provided by a restaurant, eating joint, etc., taxable at the rate of 2.5% each under CGST and Delhi GST. - Jurisdictional Officer's Comments: The applicant's classification under entry (i) of S.No. 7 of Notification No. 46/2017-Central Tax (Rate) dated 14.11.2017 is correct. - Ruling: The supply of food and beverages (cooked/MRP/packed) at food stalls has no element of service and is considered pure supply of goods. GST shall be charged on individual items at their respective applicable rates. The benefit of S.No. 7 of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 is not admissible to the applicant. B. Supply of Food on Board the Rajdhani Trains: - Applicant's View: The supply of food on board the Rajdhani trains falls under the category of services provided by a restaurant, eating joint, etc., taxable at the rate of 2.5% each under CGST and Delhi GST. - Jurisdictional Officer's Comments: The activity seems to fall under entry (v) as outdoor catering, taxable at 9%. - Ruling: The service charges for catering services on board Rajdhani/Duronto Express trains are covered under Service Code (Tariff) 996335 as "catering services in train" and are taxable under S.No. 7 (ix) of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 at 9%. The supply of food and beverages is considered pure supply of goods, and GST shall be charged on the value of goods (excluding service charges) at applicable rates. The supply of newspapers is at 'Nil' GST under S.No. 120 of Notification No. 2/2017-Central Tax (Rate) dated 28.06.2017. C. Supply of Food on Board the Mail/Express Trains: - Applicant's View: The supply of food on board the Mail/Express trains falls under the category of services provided by a restaurant, eating joint, etc., taxable at the rate of 2.5% each under CGST and Delhi GST. - Jurisdictional Officer's Comments: The activity seems to fall under entry (v) as outdoor catering, taxable at 9%. - Ruling: The supply of food and beverages (cooked/MRP/packed) on board Mail/Express trains by the applicant directly to passengers is considered pure supply of goods. GST shall be charged on individual items at their respective applicable rates. The benefit of S.No. 7 of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 is not admissible to the applicant. D. Supply of Food in Food Plaza on Railway Platform: - Applicant's View: Not explicitly provided. - Jurisdictional Officer's Comments: Not explicitly provided. - Ruling: No ruling can be given due to the lack of submission of relevant documents pertaining to details of items supplied, pricing details, and the extent of services provided. Issue 2: Applicable Rate of Tax on the Supply of Newspapers - Applicant's View: The supply of newspapers is exempt from tax vide Entry at S.No. 120 of Notification No. 2/2017-Central Tax (Rate) dated 28.06.2017. - Jurisdictional Officer's Comments: The supply of newspapers is nil rated on account of being exempt vide Entry S.No. 120 of Notification No. 2/2017-Central Tax (Rate) dated 28.06.2017. - Ruling: The supply of newspapers is at 'Nil' GST under S.No. 120 of Notification No. 2/2017-Central Tax (Rate) dated 28.06.2017. Conclusion: The Authority for Advance Rulings determined that the supply of food and beverages on board trains and at railway platforms should be treated as pure supply of goods, subject to GST at applicable rates for each item. Catering services on board trains are classified under "catering services in train" and taxed at 9%. The supply of newspapers is exempt from GST. The ruling clarifies that trains cannot be considered as restaurants or eating joints for tax purposes.
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