Case Details: Friends Catering CBE, In re [2026] 186 taxmann.com 517 (AAR - TAMILNADU)
Judiciary and Counsel Details
- B. Suseel Kumar & C. Thiyagarajan, Member
Facts of the Case
The applicant was engaged in preparing food at its premises and supplying it to clients for occasional events held at venues such as marriage halls, exhibition halls, and similar locations. It adopted two supply models: preparation of food at its premises, with deployment of manpower for serving and on-site event support; and preparation of food at its premises, followed by delivery to the customer’s location without providing labour or any other on-site service. In both models, the activities constituted composite supplies liable to be treated as a supply of service. It further contended that the services were classifiable under SAC 996334 as outdoor catering services, and sought a ruling on the applicable tax rate. The matter was accordingly placed before the Authority for Advance Ruling (AAR)
AAR Held
The AAR held that both models adopted by the applicant constituted composite supplies as the preparation of food and the associated activities of serving or arranging transportation were naturally bundled and therefore qualified as supply of service under clause (b) of paragraph 6 of Schedule II to the CGST Act. It held that the services were appropriately classifiable under SAC 996334 as outdoor catering services since the supplies were made for occasional events at venues such as marriage halls and exhibition halls and did not fall within restaurant service. It was held that the services were specifically covered under Entry 7(iv) of Notification No. 11/2017-Central Tax (Rate), dated 28-06-2017, as amended by Notification No. 20/2019-Central Tax (Rate), dated 30-09-2019, attracting GST at 5% without input tax credit subject to the prescribed condition. It also held that once the services were covered by the specific entry, the residual Entry 7(vi) providing for taxation at 18% with input tax credit was inapplicable.
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