TMI Blog2018 (10) TMI 1313X X X X Extracts X X X X X X X X Extracts X X X X ..... inition of supplier as provided in subsection (105) of Section 2 of the GST Act, 2017. Moreover, since the appellant recovers the cost of food items from their employees, there is consideration as defined in Section 2(31) of the GST Act, 2017. Ruling:- The supply of food items to the employees for consideration in the canteen run by the appellant company would come under the definition of 'supply' and would be taxable under GST. - CT/7726/2018-C3 - - - Dated:- 25-9-2018 - Pullela Nageswara Rao and Rajan N.Khobragade Sub: GST Act, 2017 - Appellate Authority for Advance Ruling U/s 99 of the Kerala State Goods and Services Tax Act, 2017 - whether recovery of food expenses from employees for the canteen provided by co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d is paid monthly salary. c) The vegetables and other items required for preparing the food items are purchased by the Company directly from the suppliers. d) The number of times, the Canteen facility is availed, each day, by the employees is tracked on a daily basis. e) Based on the details above, the expenditure incurred by the Company on the vegetables and other items required for preparation of food is recovered from the employees, as a deduction from their monthly salary, in proportion to the food consumed by them. f) The company does not make any profit while recovering the cost of the food items, recovered from the employees. Only the actual cost incurred for the food items is recovered from the employees. 4. The compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is 'supply' as provided in Section 7(1)(a) of the GST Act, 2017. The appellant would definitely come under the definition of 'supplier' as provided in sub-section (105) of Section 2 of the GST Act, 2017. 11. The term 'consideration' is defined in Section 2(31) of the GST Act, 2017 which is extracted below: 'consideration' in relation to the supply of goods or services or both includes,- a) any payment made or to be made, whether in money or otherwise, in respect of, in response to, or for the inducement of, the supply of goods or services or both, whether by the recipient or by any other person but shall not include any subsidy given by the Central Government or a State Government; ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y ' as defined in Section 2(83) of the SGST Act, 2017 and would be taxable as a supply of service under GST. 9. Aggrieved by the said Advance Ruling, the appellant preferred appeal vide paper read 2nd above, before the Appellate Authority for Advance Ruling. The Authority heard the authorized representative of the appellant on the matter on 13th September 2018 in the Chamber of the Principal Secretary Commissioner, State Goods Service Tax Department, Kerala. 10. The appellant contended that as per Schedule III, Clause 1 of GST Act 2017, services by an employee to the employer in the course of or in relation to his employment is neither a supply of goods, nor a supply of services and that any consideration received by the emplo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the appellant does not constitute a 'supply' within the meaning of Section 7 of the GST Act, 2017 and hence does not attract GST. 13. During the Personal Hearing the authorized representative of the Appellant, in addition to the reiteration of the submissions made in the original application for Advance Ruling, submitted that M/s. Caltech Polymers Pvt. Ltd. is a private limited company manufacturing foot wears. As per the requirement of Factories Act, for an industry having more than 250 employees, canteen facility shall be provided. To comply with the statutory requirements, the company provides food to the employees and cash is recovered from their salary. The authority below classified it as supply in furtherance of bus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lue Added Tax stood on separate and independent footing. The Hon'ble Court in Para 12 of the said Order held that the petitioner has paid the value added tax on the value of the food supplied to its workers. In respect of some assessment years, they have even been imposed with a penalty under the Andhra Pradesh Value Added Tax Act, 2005. Therefore, once the State Authorities have treated the supply of food to the workers of the petitioner as sale, it is not open to the respondents to treat the same as service and impose a liability. 16. It is apparent from the extract supra that, in the above referred case, the food provided to the employees was already taxed under the erstwhile Value Added Tax and thereby the Hon'ble High C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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