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The subsidized deduction made by the applicant, from the employees who are availing food in the factory, would be considered towards "supply" of canteen service by the Applicant under the provisions of Section 7 of the CGST/KGST Act 2017. GST is liable to be paid by the applicant on the value of the said supply to be determined under Rule 30 or 31 of the CGST Rules 2017. The applicant is not eligible to avail Input Tax Credit ("ITC") of the GST paid on the manpower supply services used for providing canteen facility.

Levy of GST— In the instant case, the applicant is a manufacturer of auto components i.e. pistons, piston pins & piston rings and is engaged in manufacture, supply and distribution of the said auto components used in two/three/four wheeler automobiles. They have a factory to manufacture the auto components and have about 3200 employees working on a permanent as well as contractual basis.

The applicant has sought advance ruling in relation to applicability of GST on the deductions made from the salary of the employees in respect of the following questions:-

Whether the subsidized deduction made by the applicant from the employees who are availing food in the factory would be considered as a "supply" by the Applicant under the provisions of Section 7 of the CGST/KGST Act 2017.

a. In case answer to above is yes, Whether GST is applicable on the nominal amount being recovered by the Applicant?

b. Whether Input Tax Credit ("ITC") of the GST charged by the Service Provider would be eligible for availment to the Applicant?

In the instant case, the applicant and their employees are related persons and the supply is of canteen services (SAC 996333), wherein open market value and the value of like kind and quality are not available from the facts furnished by the applicant and thus clauses (a) and (b) are not applicable and clause (c) alone is applicable, in accordance to which the value of impugned supply has to be determined by the application of rule 30 or rule 31 of the CGST Rules 2017.

Held that— a) The subsidized deduction made by the applicant, from the employees who are availing food in the factory, would be considered towards "supply" of canteen service by the Applicant under the provisions of Section 7 of the CGST/KGST Act 2017. GST is liable to be paid by the applicant on the value of the said supply to be determined under Rule 30 or 31 of the CGST Rules 2017.

b) The applicant is not eligible to avail Input Tax Credit ("ITC") of the GST paid on the manpower supply services used for providing canteen facility.

The subsidized deduction made by the applicant, from the employees who are availing food in the factory, would be considered towards "supply" of canteen service by the Applicant under the provisions of Section 7 of the CGST/KGST Act 2017. GST is liable to be paid by the applicant on the value of the said supply to be determined under Rule 30 or 31 of the CGST Rules 2017. The applicant is not eligible to avail Input Tax Credit ("ITC") of the GST paid on the manpower supply services used for providing canteen facility.

The applicant has sought advance ruling in relation to applicability of GST on the deductions made from the salary of the employees in respect of the following questions:-

a. In case answer to above is yes, Whether GST is applicable on the nominal amount being recovered by the Applicant?

b. Whether Input Tax Credit ("ITC") of the GST charged by the Service Provider would be eligible for availment to the Applicant?

b) The applicant is not eligible to avail Input Tax Credit ("ITC") of the GST paid on the manpower supply services used for providing canteen facility.