Clarification of applicability of GST over recent circulars

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Circular No. 201/13/2023-GST & Circular No. 200/12/2023-GST dated 1st August 2023, have clarified the applicability of the levy of GST on various transactions which are summarized below. 


S.No

Tariff Item

GST Rate

1.         

Un-fried or un-cooked snack pellets, by whatever name called, manufactured through

process of extrusion

i.                    Extruded or expanded products, savory or salted & Ready to eat form – 18%

ii.                  supply of uncooked/ Un-fried extruded snack pellets – 5%

 

2.       

Fish Soluble Paste

5%

3.        

Trauma, spine and arthroplasty implants falling under the HSN 9021

5% and clarified that no refunds will be granted in cases where GST has already been paid at higher rate of 12%.

It is also clarified by the council for the applicability of restaurant services to Cinema halls. The circular reads as

“It is hereby clarified that supply of food or beverages in a cinema hall is taxable as ‘restaurant service’ as long as:

a. The food or beverages are supplied by way of or as part of a service, and

b. Supplied independent of the cinema exhibition service.

It is further clarified that where the sale of cinema ticket and supply of food and beverages are clubbed together, and such bundled supply satisfies the test of composite supply, the entire supply will attract GST at the rate applicable to service of exhibition of cinema, the principal supply.”


In addition, RCM Applicability for the services from the directors gets clarity where, “services supplied by a director of a company or body corporate to the company or body corporate in his private or personal capacity such as services supplied by way of renting of immovable property to the company or body corporate are not taxable under RCM. Only those services supplied by director of company or body corporate, which are supplied by him as or in the capacity of director of that company or body corporate shall be taxable under RCM in the hands of the company or body corporate under notification No. 13/2017-CTR (Sl. No. 6) dated 28.06.2017.”

In light of the above circulars, it is clear that restaurant services provided in cinema halls attract the GST levy as applicable for movie tickets only if they are provided together. If the consumer arrives in only for restaurant services, then the said will not be applicable. 

Further, any services provided by the director in his personal capacity will not attract RCM and that it is to be paid on FCM basis. The nature of transactions is classified from the umbrella of “Services received from the Director”. Hence, the transactions are to be classified in the same manner.

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K N Akshaya MA LLB

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