Classification of service— In the instant case, the applicant is an unregistered person. 

The applicant M/s. Healersark Resources Private Limited are in the business of providing boarding and lodging to the students undergoing training under healthcare related vocational program. They are desirous of ascertaining whether the service provided by them falls under serial no. 14 of Notification No. 12/2017 dt:28.06.2017 as they are charging only Rs.300/- per day.

Questions raised for advance ruling are as follows—

1. What is the applicable GST SAC and GST rate for the supply of service described in this application?

2. Is it a composite supply or a mixed supply?

3. Whether the service is exempted vide Notification No. 12/2017 – CT(Rate) dated: 28.06.2017?

According to the applicant, the chapter heading ‘9963’ at serial no. 14 of Notification No. 12/2017 dt: 28.06.2017 describes such services for residential or lodging purposes and exempts the same if the value of supply of a unit of accommodation is below Rs.1000/- per day. The applicant states that he is charging only Rs.9000/- per month which amounts to Rs.300/- per day for both accommodation and food as a composite supply. Further that the supply of food is ancillary to accommodation and accommodation being the principle supply, hence he claims that their service is exempt from tax in view of this entry.

Held that— a. There are two distinct supplies in this contract one for accommodation and the other for food.

b. The SAC for supply of accommodation is ‘99631’ and as enumerated at serial no. 14 of Notification No. 12/2017 dt: 28.06.2017 this is exempt in the present case as per day rent is below Rs.1000/-.

c. The SAC for supply of food is ‘99633’ and taxable at the rate is:

i. 6% CGST & SGST each with ITC upto 14.11.2017.

ii. 2.5% CGST & SGST each without ITC thereafter from 15.11.2017 onwards

There are two distinct supplies in this contract one for accommodation and the other for food.