One more query regarding canteen prices fixation:
a) GST should be borne by Employer or Employee where canteen running in a factory as per factories act 1948 with NO-LOSS NO PROFIT in Karnataka?
because as per my view the GST is paid to the Grocery vendor or vegetable vendor by a factory and it will be claimed by the factory while filing GST but Employer is claiming that Employee should bear the GST amount.
b) what is the GST value for the canteen running in a factory which is maintained by the employer?
From India, Bengaluru
1a) GST should be borne by Employer or Employee where canteen running in a factory as per factories act 1948 with NO-LOSS NO PROFIT in Karnataka?
because as per my view the GST is paid to the Grocery vendor or vegetable vendor by a factory and it will be claimed by the factory while filing GST but Employer is claiming that Employee should bear the GST amount.
b) what is the GST value for the canteen running in a factory which is maintained by the employer?
From India, Bengaluru
A reading of this link will be helpful
https://taxguru.in/goods-and-service...rial-unit.html
AAAP ruling in this cae would be helpful
https://taxguru.in/goods-and-service...employees.html
From India, Pune
https://taxguru.in/goods-and-service...rial-unit.html
AAAP ruling in this cae would be helpful
https://taxguru.in/goods-and-service...employees.html
From India, Pune
Sir
Running a canteen is under follow up with the Act of factories Act and IndustrialEmployment standing orders Act.
So it is a welfare measure.
Usually it should be bore by the company like providing infrastructure to run the canteen i.e.like dining hall plates vessels Gas stove etc.if not add this Gst amounts to total cost expenses of cereals and no division or no separate calculation of purchasing eatables for cooking menu like rice vegetables cereals .Add with total purchase cost only.Then as per your agreement bear the expenses as usual.No issue .. Don't raise aany issue like this as there is no issue unless with in the company could face unrest and loss of industrial peace.
From India, Nellore
Running a canteen is under follow up with the Act of factories Act and IndustrialEmployment standing orders Act.
So it is a welfare measure.
Usually it should be bore by the company like providing infrastructure to run the canteen i.e.like dining hall plates vessels Gas stove etc.if not add this Gst amounts to total cost expenses of cereals and no division or no separate calculation of purchasing eatables for cooking menu like rice vegetables cereals .Add with total purchase cost only.Then as per your agreement bear the expenses as usual.No issue .. Don't raise aany issue like this as there is no issue unless with in the company could face unrest and loss of industrial peace.
From India, Nellore
Yes, sure it's subjected to GST as per extant rules.
Schedule II to the GST Act describes the activities to be treated as supply of goods or supply of services. As per clause 6 of the Schedule, the following composite supply is declared as supply of service.
"supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration. "
The AAR observed that even though there is no profit as claimed by the applicant on the supply of food to its employees, there is ‘supply’ as provided in Section 7(1) (a) of the GST Act, 2017. The applicant would definitely come under the definition of ‘Supplier’ as provided in sub-section (105) of Section 2 of the GST Act, 2017.
Further, since the applicant recovers the cost of food from its employees, there is consideration as defined in Section 2(31) of theGST Act, 2017.
The Authority for Advance Ruling (AAR) ruled that the recovery of food expenses from the employees for the canteen services provided by company would come under the definition of ‘outward supply’. Therefore, it would be taxable as a supply of service under GST.
The AAAR observed that crucial issues involved are that of ‘consideration’ and ‘supply’. It held that inspite of the absence of any profit, the activity of supplying food and charging price for the same from the employees would surely come within the definition of ‘supply’ as provided in Section 7(1)(a) of the GST Act, 2017. Consequently, the appellant would definitely come under the definition of ‘supplier’ as provided in sub-section (105) of Section 2 of the GST Act, 2017. Moreover, since the appellant was recovering the cost of food items from their employees, there was ‘consideration’ as defined in Section 2(31) of the GST Act, 2017.
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As such, the question of who would bear the addl.levy is left to the discretion of the employer/employee combine. Most of these canteen supplies are subsidised and any GST will have to be subsumed in the subsidy if employees not agreeing a proportionate increase in prices of food stuffs supplied in the canteen.
From India, Bangalore
Schedule II to the GST Act describes the activities to be treated as supply of goods or supply of services. As per clause 6 of the Schedule, the following composite supply is declared as supply of service.
"supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration. "
The AAR observed that even though there is no profit as claimed by the applicant on the supply of food to its employees, there is ‘supply’ as provided in Section 7(1) (a) of the GST Act, 2017. The applicant would definitely come under the definition of ‘Supplier’ as provided in sub-section (105) of Section 2 of the GST Act, 2017.
Further, since the applicant recovers the cost of food from its employees, there is consideration as defined in Section 2(31) of theGST Act, 2017.
The Authority for Advance Ruling (AAR) ruled that the recovery of food expenses from the employees for the canteen services provided by company would come under the definition of ‘outward supply’. Therefore, it would be taxable as a supply of service under GST.
The AAAR observed that crucial issues involved are that of ‘consideration’ and ‘supply’. It held that inspite of the absence of any profit, the activity of supplying food and charging price for the same from the employees would surely come within the definition of ‘supply’ as provided in Section 7(1)(a) of the GST Act, 2017. Consequently, the appellant would definitely come under the definition of ‘supplier’ as provided in sub-section (105) of Section 2 of the GST Act, 2017. Moreover, since the appellant was recovering the cost of food items from their employees, there was ‘consideration’ as defined in Section 2(31) of the GST Act, 2017.
------------
As such, the question of who would bear the addl.levy is left to the discretion of the employer/employee combine. Most of these canteen supplies are subsidised and any GST will have to be subsumed in the subsidy if employees not agreeing a proportionate increase in prices of food stuffs supplied in the canteen.
From India, Bangalore
In simple terms, GST burden is to be borne by employer/Company. For the raw materials purchased by the Company, for canteen, including, utensils, kitchenware, etc. GST paid by the company, can be collected back by company through input tax credit. As the same is a factory canteen, employees have to be given only subsidised food.
From India, Aizawl
From India, Aizawl
Gst is applicable at the rate of 5% without ITC.
Employer is supposed to borne the GST.
Employees of the company are out of the purview of GST.
However there is a ambiguity on 18%, where the services are provided by catering services provider on contract. In case of 18 % the employer can avail ITC.
From India, Vadodara
Employer is supposed to borne the GST.
Employees of the company are out of the purview of GST.
However there is a ambiguity on 18%, where the services are provided by catering services provider on contract. In case of 18 % the employer can avail ITC.
From India, Vadodara
Dear colleagues,
One more facet on the issue, pl.take note of a judgment passed by the AP High court on similar issue.Pl.see the excerpts from the judgment attached. Here the sale of subsidised food to the workers are treated as part of 'wages' under the ID Act and VAT was paid by the employer. Hence held not a 'service' under the ST.
From India, Bangalore
One more facet on the issue, pl.take note of a judgment passed by the AP High court on similar issue.Pl.see the excerpts from the judgment attached. Here the sale of subsidised food to the workers are treated as part of 'wages' under the ID Act and VAT was paid by the employer. Hence held not a 'service' under the ST.
From India, Bangalore
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