ITC on outdoor caterer supplying food in company under Factories Act, 1948

[NAUSHERAWAN SM]

Let me know whether ITC will be eligible of outdoor caterer supplying and serving foods and beverages in a company canteen for the employee registered under Factory Act, 1948.. Also let me know whether any purchases more than ₹ 5000/- for company pantry like tea, biscuits, cold drinks etc from unregistered party will attract GST in RCM.

[Himansu Sekhar]

Foods are specifically excluded under sec 17(5)

The expenses will attract RCM

[Nash Industries I Pvt Ltd]

Foods and beverages are under negative list. Supplies from an unregistered person attracts RCM.

Regards

S.Ramaswamy

[KIRTIKUMAR PUROHIT]

Nature of Expense	Rate of Tax	Whether registered supplier will levy tax	Reverse Charge(If supply is unregistered)	Whether Eligible for Input Credit
Food & Beverages Expense (AC restaurant)	18%	Yes	Yes	No
Mineral water	18%	Yes	Yes	Yes

Outward supply to the same category of business Register in GST for as a part of furtherance of business than recipient can eligible for ITC otherwise Not.

[Himansu Sekhar]

More over food items are excluded from the purviews of ITC.

AI Summary

Input Tax Credit exclusion for food and beverages means catering supplies to company canteens are not eligible under GST. Food and beverage supplies to a company canteen are excluded from Input Tax Credit, so ITC is generally unavailable; when supplied by an unregistered person, the recipient may be liable under the Reverse Charge Mechanism to pay GST. Items like mineral water may be treated differently and can be eligible for ITC when GST is charged. ITC availability also depends on whether the supply is in the course or furtherance of business and the registration status of supplier and recipient.