TMI BlogClarifications regarding applicable GST rates & exemptions on certain servicesX X X X Extracts X X X X X X X X Extracts X X X X ..... Undertakings and Local Authorities, 7. Services by way of grant of mineral exploration and mining rights attracted GST, 8. Admission to amusement parks having rides etc. , 9. Services supplied by contract manufacture to brand owners or others for manufacture of alcoholic liquor for human consumption. 2. The issue-wise clarifications are given below: 3. Services by cloud kitchens/central kitchens: 3.1 The clarification regarding the classification and rate of GST on services rendered by Cloud kitchen or Central Kitchen. 3.2 The word restaurant service is defined in in Notification No.11/2017 - STR as below: - Restaurant service means supply, by way of or as part of any service, of goods, being food or any other article for human consumption or any drink, provided by a restaurant, eating joint including mess, canteen, whether for consumption on or away from the premises where such food or any other article for human consumption or drink is supplied.‟ 3.3 The explanatory notes to the classification of service state that 'restaurant service' includes services provided by Restaurants, Cafes and similar eating facilit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mention that entry 72 of notification No.12/2017-State Tax (Rate) dated 30th June, 2017, exempts services provided to the Central Government, State Government, Union territory administration under any training programme for which total expenditure is borne by the Central Government, State Government, Union territory administration. 5.3 The scope of this entry is wide enough to cover coaching services provided by coaching institutions and NGOs under the central scheme of 'Scholarships for students with Disabilities where total expenditure is borne by the Government by way of funding to institute providing such coaching. 5.4 Accordingly, as recommended by the GST Council, it is clarified that services provided by any institutions/ NGOs under the central scheme of 'Scholarships for students with Disabilities where total expenditure is borne by the Government is covered under entry 72 of notification No. 12/2017-State Tax (Rate) dated 30th June, 2017 and hence exempt from GST. 6. Satellite launch services provided by NSIL. 6.1 The clarification regarding issuance of a clarification recognizing Satellite Launch Services supplied by M/s New Spac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for Advance Ruling that the entry at Sl. No. 22 of notification No. 12/2017-State Tax (Rate) exempts services by way of giving on hire vehicles to a State Transport Undertaking or a local authority and not renting of vehicles to them. The ruling referred to certain case laws pertaining to erstwhile positive list based service tax regime. 8.3 It is relevant to note in this context that Schedule II of SGST Act, 2017 declares supply of any goods without transfer of title as supply of service even if right to use is transferred. Transfer of right to use has been declared as a supply of service [Schedule II, Entry 5(f) refers] 8.4 The issue was placed before the 45th GST Council Meeting held on 17.09.2021. As recommended by the GST Council, it is clarified that the expression giving on hire in Sl. No. 22 of the Notification No. 12/2017-ST (Rate) includes renting of vehicles. Accordingly, services where the said vehicles are rented or given on hire to State Transport Undertakings or Local Authorities are eligible for the said exemption irrespective of whether such vehicles are run on routes, timings as decided by the State Transport Undertakings or Local Authorities and under ef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds. Appellate Authority for Advance Ruling, Odisha has further held that the amendment carried out vide Notification No. 27/2018-State Tax (Rate), dated 12.09.2019,which restricted the same rate as applicable to supply of goods involving transfer of title in goods only to leasing or renting of goods was to clarify the legislative intent as well as to resolve the unintended interpretation. It is a settled law that interpretation which defeats the intention of legislature cannot be adopted. It accordingly upheld that licensing services for the right to use minerals including its exploration and evaluation falling under service code 997337 were taxable @ 18% during 01.07.2017 to 31.12.2018. 9.2.2 It may be noted that the expression same rate of tax as applicable on supply of like goods involving transfer of title in goods applies in case of leasing or renting of goods. In case of grant of mining rights, there is no leasing or renting of goods. Hence, the said entry does not extend to grant of mining rights which is an entirely different activity. 9.3 The issue was place before the GST Council in its 45th meeting held on 17.9.2021. 9.3.1 As regards classification of serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. 10.3 On the recommendations of the Council, it is clarified that 28% rate [entry 34 (iiia)] applies on admission to a place having casino or race club [even if it provides certain other activities] or admission to a sporting event like IPL. On the other hand, Entry 34 (iii), having a rate of 18%, covers all other cases of admission to amusement parks, or theme park etc or any place having joy rides, merry- go rounds, go- carting etc, whether indoor or outdoor, so long as no access is provided to a casino or race club. This clarification will also apply to Entries 34(iii) and 34(iiia) as they existed prior to their amendment w.e.f 01.10.2021. 10.4 The entries in question have been suitably amended vide notification No. 6/2021-State Tax(Rate) dated 10.03.2022 to make them clearer. 11. Services supplied by contract manufacturers to brand owners for manufacture of alcoholic liquor for human consumption 11.1 The clarification regarding the job work services supplied by contract manufacturers to brand owners for manufacture of alcoholic liquor for human consumption attract GST @ 5% prescribed for job work services in relation to food and food products, in terms of SI. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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