ITC of Canteen Exp.(Food & beverages) _in Factory

[Prem Choudhary]

Dear Expert

As per amendment in Section 17(5)(b)CGST Act, 2017 as amended by the CGST (Amendment) Act, 2018 w.e.f 1^st February, 2019, allows input tax credit in respect of such goods or services or both, where it is obligatory for an employer to provide the same to its employees under any law for the time being in force.

The canteen is obligatory in Factories Act 1948 therefore We can take Credit of Canteen bills of food and beverages exp.

1. if Canteen is given on contract then Credit of contractor bills can take credit

2. if maintained by Company self ,then ITC on material consumed in canteen can be take credit

please advice if any contrary views.

AI Summary

Exploring ITC eligibility for canteen expenses under GST: Impact of CGST Act amendments and Factories Act requirements. A discussion on the eligibility of input tax credit (ITC) for canteen expenses under the Goods and Services Tax (GST) framework, following amendments to the CGST Act effective from February 1, 2019. The forum addresses whether ITC can be claimed when canteen services are obligatory under the Factories Act, 1948. Key points include conditions under which ITC is allowed, such as the number of employees and whether charges are recovered from them. The discussion also covers scenarios involving contractors and the implications of different GST registration schemes on ITC eligibility.