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2022 (9) TMI 365 - AUTHORITY FOR ADVANCE RULING, UTTAR PRADESHInput Tax Credit - inputs/input services - promotional scheme - Services provided by the hotel including accommodation, food & beverages - Supply of food and beverages by outside caterer to our employees in respect of Business conference meetings - section 16 read with section 17 of the CGST Act, 2017 - HELD THAT:- The promotional scheme was extended by the applicant at their own will voluntarily without any consideration in money. The goods distributed under promotional scheme are not in the nature of discounts to the products but are in the nature of personal consumables and qualifies to be termed as gifts. The 'Scheme Circular' provided by the applicant alongwith Form GST ARA-01 also contains the words 'Gift Option 1', 'Gift Option 2' and 'Gift Option 3'. Further, the gift items are fixed based on the retailers purchase of the targeted products as per Annexure C of the Form GST ARA-01 and not on the sales made by the retailers. Moreover, the rewards are handed out to the successful retailers and no tax invoice/any taxation document are raised for such handout - it is clear that the tax paid on the goods procured for distribution as rewards extended by the applicant in the `Bumper Offer, Winter Bonanza' scheme or any other such scheme is not available to them as ITC in as much as such rewards have been extended as gifts on purchase of animal health products. Admissibility of input tax credit in respect of tax paid - Services provided by the hotel including accommodation, food & beverages - Supply of food and beverages by outside caterers to their employees in respect of Business conference meetings - HELD THAT:- From the co joint reading of Section 16 and 17(5)(b) of the Central Goods and Services Tax Act, 2017, it is observed that the ITC with respect to food and beverages and outdoor catering shall be available only where an inward supply of such goods or services or both is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply - the applicant is engaged in the business of trading of animal health products and not in the business of provision of food or catering.. Even if the provision of food and catering had been in the course of furtherance of business, the applicant is not entitled to the input tax credit in light of the express bar provided under Section 17(5)(b)(i) of the CGST Act, 2017.
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