Query 1. Whether Sale of food by a restaurant is a supply of goods or a supply of service?
Query 2. Sir i am having a small shop of samosa, jalebi and gulabjamun previosly I was paying 1 %on turn over now what should I do?
Ans: GST has different slab rates for goods, services and composite supply.
Now, it becomes imperative to determine whether the supplies made by a restaurant will be treated as a supply of goods or supply of services.
In this regard, Point 6(a) of Schedule 2 to the CGST Act provides that a composite supply:
“by way of or part of any service or in any other manner, of food, drinks or any other article for human consumption shall be deemed to be supply of service.”
As per section 2(30) of CGST Act, composite supply means:
“ A supply of two or more taxable goods or services which are naturally bundled.”
Now, consider below 3 situations:
As per press release dated 05/07/2017 issued by CBEC at below link:
CGST rate on unbranded & unpackaged food items is nil.
From the above, it may be construed that unbranded & unpackaged takeaway food items from street food vendor are exempt from GST.
The author is a practising CA and is registered Insolvency Professional. He can be reached at firstname.lastname@example.org , Mob. +91 9953587496.