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TMI Blog2025 (2) TMI 129X X X X Extracts X X X X X X X X Extracts X X X X ..... ood articles by way of or as part of any service, as supply of service. The reason for undertaking a conjoint reading of both the definition and clause 6(b) of schedule-II, is to highlight the fact that to fall within the ambit of 'restaurant service', the pivotal factor is that the supply of food has to be a composite supply along with the supply of service. It goes without saying that sans supply of service, a supply of goods being food/beverages, fit for human consumption, is a case of pure supply of goods.
Conclusion - The sale of readily available food and beverages not prepared in the restaurant is a supply of goods and subject to the applicable GST rate, not qualifying as 'restaurant services.' X X X X Extracts X X X X X X X X Extracts X X X X ..... (Rate) dated June 30, 2017? 5. Consequent to hearing the applicant, the Gujarat Authority for Advance Ruling [GAAR], recorded the following findings viz * the appellant, engaged in restaurant business is supplying foods which is prepared cooked in the restaurant & also purchased from outside & sold over the counter in the restaurant premises; * the activity of the appellant is of preparing food in the kitchen at the restaurant premises & serving the same to the customers who either consume it at the restaurant or at their place; that delivery of food is also done at the customers premises; that these activity gets covered under restaurant services in terms of circular no. 164/20/2021-GST dated 6.10.2021, * that in terms of agenda item 9 of the minutes of the 23rd GST Council meeting held on 10.11.2017, it was clarified that all stand-alone restaurants, whether air conditioned or otherwise, shall attract GST @ 5% without ITC; that food parcel/takeaway from restaurant shall also attract the same rate of GST; * that food & beverages prepared /cooked in the restaurant & supplied to customers either consumed or by way of takeaway, will qualify as 'restaurant services', classif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ounter; * AAR misconstrued the AAAR ruling in the case of M/s. Kundan Mishthan Bhandar 2019-VIL-24-AAAR; * that they wish to rely on the ruling in the case of M/s. Gangur Sweets 2020 (6) TMI 815-AAR Chhattisgarh also. 8. Personal hearing in the matter was held on 08.11.2024, wherein Shri Chintan Vasa, CA appeared on behalf of the appellant and reiterated the grounds of appeal. During the course of personal hearing, the authorized representative submitted a copy of circular no. 201/13/2023-GST dated 1.8.2023. 9. We have carefully gone through and considered the appeal papers, written submissions filed by the appellant, submissions made at the time of personal hearing, the impugned ruling and other materials available on record. 10. Before dwelling on to the issue, we would like to reproduce relevant portions of circular/clarification & the exemption notification for case of reference viz Schedule II [see section 7] Activities or transactions] to be treated as supply of goods or supply of service 6. Composite supply The following composite supplies shall be treated as a supply of services, namely:- (a).......; and (b) supply, by way of or as part of any service or i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d attract 5% GST [without ITC]. 4. Supply of ice cream by ice cream parlors 4.1 Representations have been received requesting for clarification regarding the supplies provided in an ice cream outlet. 4.2 Ice cream parlors sell already manufactured ice-cream and they do not have a character of a restaurant. Ice-cream parlors do not engage in any form of cooking at any stage, whereas, restaurant service involves the aspect of cooking/preparing during the course of providing service. Thus, supply of ice-cream parlor stands on a different footing than restaurant service. Their activity entails supply of ice cream as goods (a manufactured item) and not as a service, even if certain ingredients of service are present. 4.3 Accordingly, as recommended by the Council, it is clarified that where ice cream parlors sell already manufactured ice-cream and do not cook/prepare ice-cream for consumption like a restaurant, it is supply of ice cream as goods and not as a service, even if the supply has certain ingredients of service. Accordingly, it is clarified that ice cream sold by a parlor or any similar outlet would attract GST at the rate of 18%. * Circular No. 201/13/2023-GST dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r human consumption, provided by a restaurant/eating joint including mess, canteen, by way of or as part of any service, irrespective of whether it is consumed at the restaurant premises or otherwise. Now, clause 6(b) of schedule-II, read with section 7(1A), ibid, in a similarly worded sub-clause, mentions activity of supply of food articles......., by way of or as part of any service, as supply of service. The reason for undertaking a conjoint reading of both the definition and clause 6(b) of schedule-II, is to highlight the fact that to fall within the ambit of 'restaurant service', the pivotal factor is that the supply of food has to be a composite supply along with the supply of service. It goes without saying that sans supply of service, a supply of goods being food/beverages, fit for human consumption, is a case of pure supply of goods. 13. The aforementioned finding is substantiated vide the clarification issued vide circular no. 201/13/2023-GST dated 1.8.2023, reproduced supra, wherein it was clarified that supply of food or beverages in a cinema hall is taxable as 'restaurant service' as long as the food or beverages are supplied by way of or as a part of a service.... 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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