Karnataka HC to Decide GST Classification for Donuts and Bakery Products, Stays Demand [Read Order]

The Karnataka High Court is set to decide an important case about how GST (Goods and Services Tax) should be charged on donuts, cakes, and other bakery products. The court granted interim relief to Mad Over Donuts.

This case involves Himesh Foods Pvt. Ltd., the company that runs Mad Over Donuts, and could affect many businesses in the food and bakery industry. The hearing took place on April 25, 2025, before Justice S.R. Krishna Kumar. The main question is whether these products should be taxed like food served in restaurants, which has a lower GST rate of 5%, or as regular bakery goods, which may be taxed differently.

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The counsel for Himesh Foods argued that selling donuts and cakes, whether people eat them at the shop or take them home, should be counted as a service just like restaurant food. They also referred to a recent order from the Bombay High Court, which had agreed that such products could be treated as services under GST law.

Another issue raised in the case was about the tax authorities sending multiple notices to the company from different states, even though the central GST office in Mumbai was already handling the matter. The company said this was unfair and called it harassment, as the central authority had already taken charge of the issue.

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During the hearing, the court observed that the GST department had already promised the Bombay High Court that they would not take any forceful action against the company while the case was still being heard. The court agreed with this and clearly said that no harsh steps should be taken against the company until the next hearing.

The court has now postponed the case to June 6, 2025, for the next hearing, giving the company some relief from any immediate penalties or tax recovery actions​.

The final decision could help clear up confusion about how GST should be applied to food items sold in different ways across India. This case and the related one being heard at the Bombay High Court (next hearing on April 28, 2025) could set an important example for how tax rules will be applied in the future for food and bakery businesses.

To Read the full text of the Order CLICK HERE

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