The applicant is running a bakery business, where different items likes cakes, bakery items, ice creams, chocolates, drinks & other eatable products are sold on take away basis. The facilities provided by the applicant in their outlets cannot be treated as restaurant service.
Appellate Authority for Advance Ruling —– Taxability on supply of Cakes, Bakery items, Ice Creams, Chocolates -- The appellant is engaged in producing and selling of bakery products viz cakes, artisan cakes, pastries, pizza, patties, sandwich, self manufactured ice-creams, handmade chocolates, cookies, beverages etc. They offer a number of customization options to mere customers with respect to the above mentioned products. The appellant sought an Advance Ruling as to whether supply of Cakes, bakery items, ice creams, chocolates, drinks and other eatable products to the customers from the counter with the facility to consume the same in the air-conditioned premises itself covered under the restaurant services; whether supply of items such as birthday stickers, candles, birthday caps, snow sprays etc. related items which are essentially used in birthday celebration can be classified as Composite Supply defined under Section 2 (30), wherein the principal supply of goods consists of bakery items, chocolates while the supply of services include the supply of air conditioned place to sit and to celebrate birthday; whether the sale of handmade chocolates which are manufactured in the workshop of the Applicant and are utilised for the purpose of providing other services such as shakes, brownies and are also retailed by packing in different containers as per the choice of the customer will be covered under the under the restaurant services; what is the nature and rate of tax applicable to the following items supplied from the premises of the Bakery shop of the Applicant (i) Items such as Birthday caps, knife, decorative items which are bundled along with the cakes and are utilised by the Customers in the premises of the outlets; (ii) Items such as Birthday caps, knife, decorative items which are bundled along with the cakes and are taken away by the Customers from the outlets; (iii) Items such as chocolate, cookies which are prepared in the nearby workshop of the Applicant and then processed / customised in the outlets of the Applicant before selling to the customers; (iv) Items such as chocolate, cookies which are prepared in the nearby workshop of the Applicant and then processed / customised in the outlet as per the choice and consumed in the premises itself; (e) Supposing, the Applicant’s firm is covered under the Composite Scheme then in such cases what will be the tax liability charged on goods which are tax free without opting for composite scheme such as bread etc.; (f) Suppose, the Applicant's firm is covered under composite Scheme, then in such circumstances whether the products which are prepared in the workshop but are sold only after certain customizations in the outlets will also be covered under the composite scheme or not. The AAR held that the supply of the items as mentioned in clause (iii) & (iv) from the premises of the Bakery shop of the Applicant qualifies as ‘composite supply’. Regarding (e) & (f), since the applicant is a manufacturer of ‘Ice Creams’, he is not eligible for ‘Composition Scheme’. Being aggrieved by the Ruling, the Appellant filed appeal.
Held that:- The Hon’ble Appellate Authority held that the ruling made by the AAR dated 09.03.2021 against the Question Nos. (a), (c), (d)(iii) & (d)(iv) are set aside; and The items sold by the applicant will attract the GST tariff rate as individual items.
The applicant is running a bakery business, where different items likes cakes, bakery items, ice creams, chocolates, drinks & other eatable products are sold on take away basis. The facilities provided by the applicant in their outlets cannot be treated as restaurant service.
Appellate Authority for Advance Ruling —– Taxability on supply of Cakes, Bakery items, Ice Creams, Chocolates -- The appellant is engaged in producing and selling of bakery products viz cakes, artisan cakes, pastries, pizza, patties, sandwich, self manufactured ice-creams, handmade chocolates, cookies, beverages etc. They offer a number of customization options to mere customers with respect to the above mentioned products. The appellant sought an Advance Ruling as to whether supply of Cakes, bakery items, ice creams, chocolates, drinks and other eatable products to the customers from the counter with the facility to consume the same in the air-conditioned premises itself covered under the restaurant services; whether supply of items such as birthday stickers, candles, birthday caps, snow sprays etc. related items which are essentially used in birthday celebration can be classified as Composite Supply defined under Section 2 (30), wherein the principal supply of goods consists of bakery items, chocolates while the supply of services include the supply of air conditioned place to sit and to celebrate birthday; whether the sale of handmade chocolates which are manufactured in the workshop of the Applicant and are utilised for the purpose of providing other services such as shakes, brownies and are also retailed by packing in different containers as per the choice of the customer will be covered under the under the restaurant services; what is the nature and rate of tax applicable to the following items supplied from the premises of the Bakery shop of the Applicant (i) Items such as Birthday caps, knife, decorative items which are bundled along with the cakes and are utilised by the Customers in the premises of the outlets; (ii) Items such as Birthday caps, knife, decorative items which are bundled along with the cakes and are taken away by the Customers from the outlets; (iii) Items such as chocolate, cookies which are prepared in the nearby workshop of the Applicant and then processed / customised in the outlets of the Applicant before selling to the customers; (iv) Items such as chocolate, cookies which are prepared in the nearby workshop of the Applicant and then processed / customised in the outlet as per the choice and consumed in the premises itself; (e) Supposing, the Applicant’s firm is covered under the Composite Scheme then in such cases what will be the tax liability charged on goods which are tax free without opting for composite scheme such as bread etc.; (f) Suppose, the Applicant's firm is covered under composite Scheme, then in such circumstances whether the products which are prepared in the workshop but are sold only after certain customizations in the outlets will also be covered under the composite scheme or not. The AAR held that the supply of the items as mentioned in clause (iii) & (iv) from the premises of the Bakery shop of the Applicant qualifies as ‘composite supply’. Regarding (e) & (f), since the applicant is a manufacturer of ‘Ice Creams’, he is not eligible for ‘Composition Scheme’. Being aggrieved by the Ruling, the Appellant filed appeal.
Held that:- The Hon’ble Appellate Authority held that the ruling made by the AAR dated 09.03.2021 against the Question Nos. (a), (c), (d)(iii) & (d)(iv) are set aside; and The items sold by the applicant will attract the GST tariff rate as individual items.