ITC allowed on supply of food & beverages from sweetmeats counter without any services to consume in premises

Authority for Advance Rulings, West Bengal Manoj Mittal, In re – [2021] 126 taxmann.com 48 (AAR-WEST BENGAL)

Short Overview :

 The applicant had a place of business with two sections out of which one section had a sweet parlour where it was engaged in selling sweetmeats, namkeens and bakery items off the counter in the form of takeaways from the said sweet parlour.

In other section of the premises, the applicant was engaged in preparing and serving fast food snacks and beverage items which can either be consumed at the premises or allowed as takeaways.

It filed an application for advance ruling to determine whether sale from the portion of the sweetmeats and bakery shop should be categorized as supply of goods and whether input tax credit should be eligible.

The Authority for Advance Ruling observed that when goods were supplied from the sweetmeats parlour without any element of supply of services or as a part of any services, it cannot be considered as a ‘composite supply’.

Such supplies would be treated as supply of goods.

Therefore, it was held that supply of food and beverages from the sweetmeats counter by the applicant, where the customers had not been provided with any services in relation to consume the same in the premises, would be categorized as supply of goods and the applicant would be eligible to avail input tax credit in respect of such supply of goods.