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The supply of ice cream from the outlets of the applicant cannot be considered as supply of ‘restaurant services’. However, an ice cream when ordered and supplied along with cooked or prepared food, through their outlets would assume the character of composite supply, wherein the prepared food being the principal supply and hence qualifies as ‘restaurant services’.

Composite Supply- In the instant case, The applicant is engaged in the restaurant business and the format of the outlets. The ice cream division has been sold. The present outlets are broadly of the three types, wherein the applicant is supplying food which is prepared and cooked in the restaurant/eatery in addition to supplying the ice creams, which are not prepared/produced by them. The main question to be decided is whether the supply of ice cream from any of the outlets of the applicant, can be considered as supply of ‘restaurant services’ or not.

The applicant has raised following question for advance ruling viz

1. Whether supply of ice cream from any of the outlets of HRPL be considered as supply of ‘restaurant services’ or not?

2. If the supply is classified as ‘restaurant services’, what would be the applicable rate of tax thereon in accordance with notification No. 11/2017-CT(Rate) dated 28.6.2017 las amended from time to timer

3. If not the restaurant services, supply of ice cream from any of the outlets of HRPL can be considered as supply of ice cream from ice cream parlour & chargeable to GST @ 18%?

Held that- 1. The supply of ice cream from the outlets of the applicant cannot be considered as supply of ‘restaurant services’. The readily available ice creams [not prepared in their outlets] sold over the counter is supply of goods. However, an ice cream when ordered and supplied along with cooked or prepared food, through their outlets would assume the character of composite supply, wherein the prepared food being the principal supply and hence qualifies as ‘restaurant services’.

2. The supply of ice cream from the outlets of the applicant is not classified as ‘restaurant services’. However, the composite supply, supra, classifiable under ‘restaurant service’ would be leviable to GST @ 5% with no input tax credit as per Sr. No. 7(ii) of notification No. 11/2017-CT (Rate) dtd 28.6.2017 as amended vide notification No. 20/2019-CT (Rate) dated 30.9.2019.

3. The supply of only ice cream [not prepared in their outlets and which is readily available] from any of the outlets of applicants is held to be akin to supply of ice cream from ice cream parlour, leviable to GST @ 18%.

The supply of ice cream from the outlets of the applicant cannot be considered as supply of ‘restaurant services’. However, an ice cream when ordered and supplied along with cooked or prepared food, through their outlets would assume the character of composite supply, wherein the prepared food being the principal supply and hence qualifies as ‘restaurant services’.

The applicant has raised following question for advance ruling viz

1. Whether supply of ice cream from any of the outlets of HRPL be considered as supply of ‘restaurant services’ or not?

3. If not the restaurant services, supply of ice cream from any of the outlets of HRPL can be considered as supply of ice cream from ice cream parlour & chargeable to GST @ 18%?