Composite food supply treated as outdoor catering service; concessional GST rate applies only without input tax credit.

Food supply models involving preparation, serving support, and transport for occasional events were treated as naturally bundled composite supplies and, under Schedule II of the CGST Act, as a supply of service. The activity was held classifiable under SAC 996334 as catering service. Because the specific outdoor catering entry applied, the concessional GST rate of 5% was available only without input tax credit, and the supply could not be shifted to the residual 18% entry with credit merely at the taxpayer's option.

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Issues: (i) Whether the applicant's two models of food supply amount to a composite supply and are classifiable as outdoor catering service under SAC 996334; (ii) Whether the supply is taxable at 5% without input tax credit and whether the applicant has an option to pay 18% with input tax credit.

Issue (i): Whether the applicant's two models of food supply amount to a composite supply and are classifiable as outdoor catering service under SAC 996334.

Analysis: The supply involved preparation of food, and in one model also included manpower for serving and on-site event support. In the other model, the food was prepared at the applicant's premises and transported to the recipient's location for occasional events. The combined supplies were naturally bundled in the ordinary course of business and therefore constituted a composite supply. Under Schedule II to the Central Goods and Services Tax Act, 2017, composite supplies of food for consideration are treated as a supply of service. The service description in the classification scheme specifically covers catering services in exhibition halls, events, marriage halls and other outdoor or indoor functions, which corresponds to the applicant's activity.

Conclusion: The applicant's food supply models are composite supplies treated as supply of service and are classifiable under SAC 996334.

Issue (ii): Whether the supply is taxable at 5% without input tax credit and whether the applicant has an option to pay 18% with input tax credit.

Analysis: The relevant entry for outdoor catering at premises other than specified premises applies to the applicant's activity. The concessional rate under Entry 7(iv) applies subject to the condition that input tax credit on goods and services used in supplying the service is not taken. The broader residual entry for accommodation, food and beverage services does not override the specific entry. The explanation clarifies that supplies covered by the specific outdoor catering entry remain governed by that entry and cannot be shifted to the residual rate at the taxpayer's option.

Conclusion: The applicant is liable to pay GST at 5% without input tax credit and has no option to pay 18% with input tax credit.

Final Conclusion: The ruling fixes the applicant's outdoor catering supplies under the specific concessional service entry and rejects the claimed option to adopt the residual higher-rate entry with credit.

Ratio Decidendi: A specifically enumerated catering entry in the service-rate notification governs the supply where its conditions are met, and such supply cannot be shifted to a residual higher-rate entry merely because input tax credit is otherwise available under that residual entry.

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