Readily available food & beverages, not prepared in restaurant not qualify as ‘restaurant services’: AAR

Case Details: Authority for Advance Rulings, Gujarat Ridhi Enterprise., In re - [2023] 146 taxmann.com 42 (AAR-GUJARAT)

Judiciary and Counsel Details

• • Milind Kavatkar & Amit Kumar Mishra, Member
  • Chintan Vasa, CA for the Applicant.

Facts of the Case

The applicant was engaged in restaurant business. It also purchased food items from local market and directly supply to customers in restaurant premises and customers may consume said food items at restaurant or take away. It filed an application for advance ruling to determine classification of both foods & beverages prepared in restaurant and readily available food items sold over the counter.

AAR Held

The Authority for Advance Ruling noted that food and beverages prepared/cooked in restaurant and supplied by applicant to its customers either consumed in restaurant or by way of takeaway would qualify as ‘restaurant services’. However, supply of readily available food & beverages, not prepared in restaurant and sold over counter would not qualify as ‘restaurant services’. It was held that restaurant services would be classifiable under SAC 996331 and would attract 5% GST with no input tax credit as per Notification 11/2017-Central Tax (Rate). But, the readily available food and beverages (not prepared in restaurant) sold over counter by applicant would be treated as supply of goods which shall be liable to applicable rate of GST for goods.