2025-VIL-13-AAR
  1. Home
  2. 2025-VIL-13-AAR

SGST Advance Ruling Authority

GST – Rajasthan AAR - Supply, Canteen facility, Input Tax Credit - Applicant operates canteen facility within its factory premises for its employees, including contractual workers. The Applicant recovers a nominal amount from the employees towards the cost of meals provided in the canteen - Whether the subsidized deduction made by the Applicant from the employees who are availing food in the factory would be considered as a "supply" by the under the provisions of Section 7 of the CGST Act, 2017 - HELD - a perk, which is not specified in employer- employee contract, is not in lieu of services, supplied by the employer to the employee but the largesse or matter of goodwill on part of such employer. Therefore, absence of mention about supply of subsidized food, in employment contract, cannot be equated with perk mentioned in the employment contract as mentioned in CBIC Circular No. 172/04/2022-GST, dated 06.07.2022 - Since the applicant had no explicit contractual agreement with regard to the canteen facility, the same cannot be equated to perquisites mentioned in the said Circular - the supply of food even at subsidized cost, is a supply within the meaning of Section 7 of the CGST Act, 2017 - Ordered accordingly - Whether the Applicant is eligible to avail Input Tax Credit (ITC) of the GST charged by the Canteen Service Provider - HELD – The applicant is not be eligible to avail ITC of the GST charged by the Canteen Service Provider - Section 17(5)(b)(i) of the CGST Act restricts the availability of ITC on food and beverages, except where it is obligatory for the employer to provide the same to its employees under any law. However, in the present case, the benefit of the proviso to Section 17(5)(b) would be available only in respect of the Applicant's direct employees and not the contractual workers. Further, the supply of food by the Canteen Service Provider to the applicant's employees is classifiable as "Restaurant Service" and is subject to a concessional GST rate of 5% without the benefit of ITC.
Download File

Quick Search

/

Advance Search

GST Resources

/

Gst Rate Finder

Tax Vista

Your Biweekly Tax Recap

By Dr. G. Gokul Kishore

Weekly Summary

VIL Video

GSTAT Rules & Industry Preparedness
By Vivek Jalan

Create Account

Security-Code
New Code?

Log In

New User ? Forgot Password ?

Forgot Password

Security-Code
New Code?
Please Note: This facility is only for Subscribing Members.

Email this page

Feedback this page

Schedule a Demo

Schedule a demo to know the features and advantages of VILGST portal. Get to know the tips to find the desired results in faster way.

Caselaw Request Form (CRF)

Didn’t find what you are searching for? No worries, please give us the following details and VIL will email you the desired Caselaws at the earliest:

Security-Code
New Code?