2026-VIL-30-AAAR
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SGST AAAR

GST – West Bengal AAAR - Restaurant Service and Composite Supply under GST – Classification of supply of non-tobacco and tobacco-based hookah along with food in restaurant - whether the activity of preparing and supplying tobacco-based and herbal (non-tobacco-based) hookah flavours through a hookah apparatus in a restaurant, together with the attendant facilities ordinarily provided therein, constitutes a supply of restaurant service within the meaning of paragraph 6(b) of Schedule II to the GST Acts, or whether such supplies are liable to be classified and taxed independently in accordance with the applicable statutory provisions - HELD - The supply of tobacco-based and herbal non-tobacco-based hookah flavours through hookah apparatus does not fall within ambit of Clause 6(b) of Schedule II merely because supplies are made in restaurant or along with food and beverages. The expression food or any other article for human consumption or any drink occurring in Clause 6(b) cannot be construed so widely as to include tobacco-based or herbal non-tobacco-based hookah flavours - The expression human consumption cannot be read in isolation divorced from statutory context and must be construed in light of expressions food and drink indicating articles ordinarily consumed by eating or drinking. The general expression ‘any other article for human consumption follows’ specific expressions food and drink belonging to well-recognised class of articles ordinarily consumed by eating or drinking. The purpose of food and beverages is distinct from that of hookah - Elaborate preparation involved in supplying hookah, use of specialised equipment and service rendered by trained personnel do not dispense with statutory requirement that goods supplied must themselves fall within category contemplated under Clause 6(b). The Composite supply provisions in Sections 2(30), 2(90) and 8 cannot enlarge scope of deeming provision contained in Schedule II - Supply of hookah comprises both goods and service elements but transaction constitutes composite supply with principal supply being supply of tobacco or non-tobacco products while service element remains ancillary – The supply of tobacco-based hookah flavours as well as herbal (non-tobacco-based) hookah flavours through a hookah apparatus in a restaurant does not fall within the ambit of paragraph 6(b) of Schedule II to the GST Acts merely because such supplies are made in conjunction with food, beverages and other restaurant facilities. Consequently, such supplies are not classifiable as restaurant service under Notification No. 11/2017-Central Tax (Rate) - The Advance Ruling order is confirmed and the appeal is dismissed
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