2019 (11) TMI 131 - AAR - GST

Food Resale Not Restaurant Service: Kerala Ruling clarifies GST classifications and rates for clarity.

In Re: M/s. Square One Homemade Treats

The Authority for Advance Ruling in Kerala determined that the resale of food and bakery products by the applicant does not fall under restaurant ... Classification of services - rate of tax - restaurant services or not - resale of food & bakery products - HELD THAT:- It is not a restaurant service - A restaurant is a place of business where food is prepared in the premises and served based on the orders received from the customer. In the instant case it is a bakery, where ready to eat items are sold and mere facility is provided to have it from the shop. classification of HSN and Tax rates on various goods - Sweets - HELD THAT:- Agra Peda, Maladoo, Rava Ladoo, Kappa Ladoo, Kesari, Kesari Beetroot, Boli, Boli Banana, Pappada Boli, Churuttu, Swefet Kachori, Halwa Guava, Halwa Jackfruit, Halwa- Mango, Halwa Wheat, Carrot Sweet, Kaju Burfi, Aval Vilayichathu, Ariunda, Avalose unda, Diamond Cuts (Sweet), Carrot Sweet and Unniyapam are classifiable under HSN Code 2106 90-Sweetmeat and attracts GST at the rate of 5% as per SI No. 101 of Schedule I of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Chappathi - HELD THAT:- Chappathi is classifiable under HSN Code 2106 90 99 and is liable to GST at the rate of 5% as per SI No.99A of Schedule I of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Coconut Chutney Powder and Dosa Chutney Powder - HELD THAT:- Coconut Chutney Powder and Dosa Chutney Powder are classifiable under HSN Code 2106 90 99 and is liable to GST at the rate of 5% as per SI No. 100A of Schedule I of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Namkeen items - HELD THAT:- Achappam, Avalose Podi, Cheeda, Diamond Cuts(Hot), Kuzhalappam, Murukku and Thatta are classifiable under HSN Code 2106 90 and is liable to GST at the rate of 12% as per SI No. 46 of Schedule II of Notification No.01/20117 Central Tax (Rate) dated 28.06.2017 for those put up in unit container and, (a) bearing a registered brand name; or (b) bearing a brand name on which an actionable claim or enforceable right in a court of law is available - The rate of GST is 5% as per SI No. 101A of Schedule I of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017 for those other than put up in unit container and, (a) bearing a registered brand name; or (b) bearing a brand name on which an actionable claim or enforceable right in a court of law is available. Banana Chips - Chakka Chips - Cheema Chakka Chips - Chembu Chips - Kappa Chips - Sarkara Varatti - Kovakkai Vattal - Pavakkai Vattal - HELD THAT:- These are classifiable under HSN Code 2008 19 40-Other roasted and fried vegetable products and is liable to GST at the rate of 12%; as per SI No. 40 of Schedule II of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Fried Peanuts and Chilly Nuts - HELD THAT:- Fried Peanuts and Chilly Nuts are classifiable under HSN Code 2008 and are liable to GST at the rate of 12% as per SI No. 40 of Schedule II of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Pickles - HELD THAT:- Various pickles are classifiable under HSN Code 2001 90 00 and attracts GST at the rate of 12% as per SI No. 33 of Schedule II of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. King Fish Pickle and Tuna Pickle - HELD THAT:- King Fish Pickle and Tuna Pickle are classifiable under HSN Code 1604 12 10 and Meat Pickle is classifiable under HSN Code 1602 90 00 and are liable to GST at the rate of 12% as per SI Nos. 31 and 29 respectively of Schedule II of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Mango Jam - Mixed Fruit Jam - Orange Jam - Pineapple Jam - Plantain Jam - HELD THAT:- Mango Jam, Mixed Fruit Jam, Orange Jam, Pineapple Jam and Plantain Jam are classifiable under HSN Code 2007 and attract GST at the rate of 12% as per SI No. 39 of Schedule II of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Juice Green Mango - Juice Mango - Juice Passion Fruit - Juice Rose Apple - HELD THAT:- Juice Green Mango, Juice Mango, Juice Passion Fruit and Juice Rose Apple are classifiable under HSN Code 2009 and attract GST at the rate of 12% as per Si No. 41 of Schedule II of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Juice Butter Milk - HELD THAT:- Juice Butter Milk is classifiable under HSN Code 0403 90 10 and is exempted as per SI No. 26 of Notification No.02/2017 Central Tax (Rate) dated 28.06.2017. Caramel Pudding - Chocolate Pineapple Pudding - Fruit Salad Mix - Tender Coconut Pudding - HELD THAT:- These are classifiable under HSN Code 2106 90 99-Other food preparations not elsewhere specified or included and is liable to GST at the rate of 18% as per SI No. 23 of Schedule III of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Payasam of all varieties - HELD THAT:- These are classifiable under HSN Code 2106 90 99- Other food preparations not elsewhere specified or included and attracts GST at the rate of 18% as per SI No. 23 of Schedule III of Notification No. 01/2017 Central Tax (Rate) dated 28.06.2017. Various sandwiches and rolls - HELD THAT:- These are classifiable under HSN Code 2106 90 99-Other food preparations not elsewhere specified or included and taxable at the rate of 18% as per Sl No. 23 of of Schedule III of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Ada Chakka - Ada Pazham, - Ada Plain - Ada Ragi - Ada Wheat - Vattayappam - Sharkara Vattayappam, Banana Ball, Banana Fry, Bonda Veg, Chicken Burger, Chicken Cheese Steak, Chilli & Padaval, Chilli Cauliflower, Chirotta, Parippu Vada, Sambar Vada, Sukhiyan, Mini Chicken Samosa, Noodle Chicken Samosa, Noodle Veg Samosa arid Punjabi Samosa - HELD THAT:- These are classifiable under HSN Code 2106 90 99-Other food preparations not elsewhere specified and liable to GST at the rate of 18% as per SI No. 23 of of Schedule III of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Various other food items - HELD THAT:- These are classifiable under HSN Code 2106 90 99-Other food preparations not elsewhere specified or included and is liable to GST at the rate of 18% as per Sl No. 23 of of Schedule III of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Lasagne - HELD THAT:- Lasagne is classifiable under HSN Code 1902 20 10 and is liable to GST at the rate of 12% as per SI No. 32B of Schedule II of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Natural Honey - HELD THAT:- Natural Honey is classifiable under HSN Code 0409 00 00 and is liable to GST at the rate of 5% as per SI No. 13 of Schedule I of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017 for those put up in unit container and, (a) bearing a registered brand name; or (b) bearing a brand name on which an actionable claim or enforceable right in a court of law is available - Natural Honey other than those put up in unit container and, (a) bearing a registered brand name; or (b) bearing a brand name on which an actionable claim or enforceable right in a court of law is available is exempt from GST as per SI No. 29 of Notification No.02/2017 Central Tax (Rate) dated 28.06.2017. Cone - HELD THAT:- Cone is classifiable under HSN Code 1905 32 90 and is liable to GST at the rate of 18% as per SI No. 16 of Schedule III of Notification No.01/2017 Central Tax (Rate) dated 28.06.2017. Issues:1. Whether resale of food & bakery products fall under restaurant services.2. Whether classification of HSN and Tax rates done by the applicant is correct or not.Issue 1:The applicant, engaged in reselling food products, sought an advance ruling to determine if the resale of food and bakery products falls under restaurant services. The applicant clarified that they do not cook food at their premises and only provide a facility for customers to consume the pre-packed food on-site. The Authority noted that a restaurant involves preparing and serving food to customers, whereas in this case, the applicant sells ready-to-eat items with an option for customers to eat on the premises. Consequently, the Authority ruled that the applicant does not qualify as a restaurant service provider.Issue 2:Regarding the classification of HSN and tax rates, the applicant sought clarification on various food items falling under nine categories. The Authority provided detailed classifications and applicable GST rates for each category of products sold by the applicant. The ruling covered items such as sweets, namkeens, chips, pickles, jams, juices, payasams, and other food preparations. The classifications were based on specific HSN codes and corresponding GST rates as per the relevant notifications. The Authority's ruling provided clarity on the correct classification and tax rates applicable to the different food products sold by the applicant.In conclusion, the Authority for Advance Ruling in Kerala addressed the issues raised by the applicant regarding the classification of food and bakery products and their tax implications. The ruling clarified that the applicant's resale of food items did not constitute restaurant services and provided detailed classifications and GST rates for various food categories. The comprehensive analysis by the Authority ensured clarity on the correct classification and taxation of the products sold by the applicant, thereby guiding them in compliance with the relevant regulations.