TMI Blog2019 (5) TMI 312X X X X Extracts X X X X X X X X Extracts X X X X ..... the conditions/ ingredients of a 'composite supply' or 'mixed supply', as defined under Section 2(30) and 2(74) of the CGST Act respectively. Supply in/through restaurant - When the goods such sweets, namkeens, cold drinks and other edible items are supplied to customers in the restaurant or as takeaway from the restaurant counter and which are being billed under restaurant sales head should fall under 'composite supply' with restaurant service being the principal supply. Since supply of food in this case, is naturally bundled with the restaurant service. The taxability of all such goods supplied to or through the restaurant will be governed by the principal service i.e. restaurant service and GST rate with applicable conditions will also be applicable to all such goods also. Input credit will not be allowed in this case. Supply from shop - All goods which are supplied to customers through sweetshop counter have no direct or indirect nexus with restaurant service. Anyone can come and purchase any item of any quantity from the counter without visiting the restaurant. The billings of such sales are also done separately. Thus such sales, by no stretch of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acks, cold drinks, ice creams and other edible items; (ii) Ready to eat (partially or fully pre-cooked/packed) items supplied from live counters such as jalebi, chola bhatura and other edible items; (iii) Takeaway order of sweetmeats or namkeens by a person sitting in the restaurant of sweetshop when such products are not consumed within the premises or the applicant but are takeaway. 3. Following the personal hearing given to the applicant on 28-8-2018, the members of the Advance Ruling Authority for the State of Uttarakhand, gave the following ruling: (i) The supply shall be treated as supply of service and sweetshop shall be treated as extension of restaurant; (ii) The rate of GST on aforesaid activity will be 5% as on date, on the condition that credit of input tax charged on goods and services used in supplying the said service has not been taken; (iii) All the items including takeaway items from the said premises shall attract GST of 5% as on date subject to the condition of non-availment of credit of input tax charged on goods and services used in supplying the said service. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Fakirchand Dudhelia v. Shree Changdeo Sugar Mills Ltd. [AIR 1962 SC 1543]; (iv) J.K. Cotton Spinning Weaving Mill v. state of U.P. [AIR 1961 SC 1170 = 1997 (91) E.L.T. 34 (S.C.)]; (v) Nasiruddin v. State Transport Appellate Tribunal [AIR 1976 SSC 331]; (vi) State of M.P. v. Narmada Bachao Andolan [(2011) 7 SCC 639]; etc. 4. That the guidance for classification can be taken from statutes in pari materia and assistance from earlier statutes. In order to bolster the argument the party relied upon the following judgments. (i) Bengal Immunity Co. Ltd. v. State of Bihar [AIR 1955 SC 661]; (ii) Federation of Hotels Restaurants Association of India v. Union of India [(2016) 72 taxmann.com 161 (Delhi) = 2016 (44) S.T.R. 3 (Del.)]; (iii) New India Sugar Mills Ltd. v. Commissioner of Sales Tax, Bihar [AIR 1963 SC 207]; (iv) Kanwar Singh v. Delhi Administration [AIR 1965 SC 871]; (v) Motor Owners Insurance Co. Ltd. v. J.K. Modi [AIR 1981 SC 2059]; (vi) Ambica Quarry Works v. state of Gujarat [AIR 1987 SC 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice shall apply and benefit of input tax shall not be available. 2nd applicant's grounds of appeal 4. Aggrieved by the said order passed by the Authority for Advance Ruling for the State of Uttarakhand, the concerned jurisdictional Officer of CGST, Haldwani, has (filed the instant appeal, on the grounds that the decision and interpretation to treat combination of supply of service on the basis of nature of establishment i.e. principal supply by a restaurant and incidental or auxiliary supply by the mithai shop is faully and untenable as supply whether composite or mixed will be determined on the basis of satisfaction of the conditions/ingredients in the definition of 'composite supply' or 'mixed supply' under Section 2(30) and 2(74) respectively of the CGST Act. 5. Accordingly, the issue needs to be decided on the basis of individual supply and its constituents. Personal hearing 6. An opportunity for personal hearing was granted to the appellant on 13-2-2019 which was attended by Shri Ashwarya Sharma, Advocate, M/s. Kundan Mishthan Bhandar, Ramnagar, Nainital. During the course o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied from the restaurant are billed under restaurant head. In such a situation, nature of the business establishment making supply of food, drinks and other articles for human consumption will not determine whether the same is a supply of goods or services but will depend on the constituents of each individual supply and whether same satisfies the conditions/ ingredients of a 'composite supply' or 'mixed supply', as defined under Section 2(30) and 2(74) of the CGST Act respectively. 12. 'Composite supply' is defined as composite supply means a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply. Thus when the goods such sweets, namkeens, cold drinks and other edible items are supplied to customers in the restaurant or as takeaway from the restaurant counter and which are being billed under restaurant sales head should fall under 'composite supply' with restaurant service being the prin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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