In a recent ruling, the West Bengal bench of the Authority for Advance Ruling ( AAR ) held that the composite supply of catering within club premises along with renting is considered as an outdoor catering service together with renting of premises and attracts 5% GST.
The applicant, The Tollygunge Club Limited, a premier and elite establishment in Kolkata, primarily provides club or association services, short-term accommodation, restaurant, and catering services. The applicant is engaged in the composite supply of catering services along with the renting of premises, all of which are provided at its own location.
The applicant seeks clarification on whether the lower GST rate of 5% under Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 (as amended) is applicable to the composite supply of “outdoor catering along with the renting of premises.”
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In this case, the applicant has made this application under sub-section (1) of section 97 of the GST Act, 2017, and the rules and one of the questions made was whether the composite supply of catering service within the club premise along with renting of premise shall be liable to GST at 5% without ITC.
The applicant submitted that the term ‘outdoor catering’ means supply, by way of or as part of any service, of goods, being food or any other article for human consumption or any drink, at exhibition halls, events, conferences, marriage halls, and other outdoor or indoor functions that are event based and occasional in nature.
The bench observed the term ‘catering’ has not been defined under the GST Act, 2017, and under the Cambridge dictionary as any job making or serving food.
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The AAR bench, comprising Dr. Tanisha Dutta and Mr. Joyjit banik, observed that the composite supply of catering services within the club premises along with renting of premises falls under outdoor catering service together with renting of premises arranged at premises other than ‘specified premises’ and that GST is payable against the whole consideration of the composite supply at 5% without ITC.
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