Outdoor catering service, Goods and Services Tax - GST

[yateen vyas]

Respected Experts,

We have manufacturing unit and we are running our canteen by a outdoor caterer.AS we are not able to take credit of outdoor catering service,I wan your input on below suggestion if we can use-

1. Can we purchase all material used in canteen in the name of our unit and only service portion is done by outdoor caterer.

2. If we purchase all material than can we able to take credit on canteen material purchase or is it fall under category of furtherance of business.

Posts / Replies

[KASTURI SETHI]

Not possible.

[Ganeshan Kalyani]

Is this your main business. One of the condition for input tax credit is purchases should be in course of or furtherance of business.

[KASTURI SETHI]

To establish furtherance of business in this aspect is a hard nut to crack.

[venkatesan natesan]

Manufacturing Unit , running the canteen at company premises , and the input tax credit ( ITC ) is allowed under GST.

[Yatin Bhopi]

Dear expert,

As per section 17(5) (b) of GST Act there are specific restriction on ITC on food and beverages, outdoor catering etc. even though all expenses are for business purpose and it is mandatory to maintain Canteen in factory as per Factories act 1948. ITC will not be available.

Please share your views