GST on Supply of food in canteens of office, factory & colleges on contractual basis

In re Prism Hospitality Services (P) Ltd (GST AAR Telangana)

Rate of GST on providing services includes operation of canteen/Mess/Eating House/mess operation/ food sales in Hospitals for patients and visitors/Campsite etc.

Section 8. Of CGST Act provides that the tax liability on a composite or a mixed supply shall be determined in the following manner, namely:- (a) a composite supply comprising two or more supplies, one of which is a principal supply, shall be treated as a supply of such principal supply; and (b) a mixed supply comprising two or more supplies shall be treated as a supply of that particular supply which attracts the highest rate of tax.

In the instant case, principal supply being supply of food i.e. outdoor catering service, and transportation is ancillary, the whole transaction attracts 18% GST being highest rate of tax compared to tax on transportation service. Therefore, the applicant needs to discharge GST on the gross amount (cost of Food + cost of Transportation ) at the rate of 18% i.e., GST rate of outdoor catering service.

FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING TELANGANA

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