Case Law Details
In re Dormer Tools India Pvt Ltd (GST AAR Gujarat)
Dormer Tools India Pvt Ltd, incorporated under the Companies Act, 2013, and registered under GST in Gujarat, has sought an advance ruling to determine the GST implications of providing canteen facilities to its employees. The company, engaged in manufacturing and selling industrial products, employs over 500 people and is mandated by the Factories Act, 1948, to provide a canteen. The key questions posed were whether the nominal deduction from employees’ salaries for food would be considered a ‘supply’ under the GST Act, and whether the company could claim Input Tax Credit (ITC) for the GST charged by the canteen service provider.
Main Issues and Contentions
- Provision of Canteen Facilities: The company provides a canteen facility managed by a canteen service provider (CSP), and it recovers a nominal amount from employees’ salaries to cover part of the canteen costs. The facility includes seating, cooking, refrigeration, storage, and sanitation facilities.
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