335, Vipul Trade Centre, Sector-48, Sohna Road, Gurgaon
Mon - Sat: 9:30-18:00

MCQ Self Challenge # 0072 on Special Provisions Relating to Rate of Tax in Case of Outdoor Catering Services

Special Provisions Relating to Rate of Tax in Case of Outdoor Catering Services

 

Dear Professional Seniors & Friends,
Warm Greeting!

Here is the Next post of #MCQ on concept based practical professional knowledge on special provisions relating to rate of tax in case of outdoor catering services in a unique manner to be self answered by participants. The detailed answer of these MCQs shall be posted next day for the self assessment of the participants.

MCQ 72.1: On 1st July, 2018 ABC caterers make a bill of Rs 100000 for providing daily food to employees of X pvt ltd on a contract basis. Which among the following is correct in relation to rate of tax?

A) 5%
B) 12%
C) 18%
D) 28%

MCQ 72.2: What if in above question, ABC provides catering services to X Pvt Ltd on 28th of July 2018?

A) 5%
B) 12%
C) 18%
D) 28%

Sincere Regards

CA Sanjay Kumar Agrawal
Mobile: 9810116321

To access MCQ posts regularly, please Join Telegram Channel:
https://t.me/caSanjayKumarAgrawal

For All MCQ post please click on:
Webpage: http://www.casanjay.me/
Facebook: https://www.facebook.com/CA.Sanjay.K.Agrawal/
Linkedin: https://www.linkedin.com/in/ca-sanjay-kumar-agrawal/

 

Answer MCQ Self Challenge # 0072

 

Dear Professional Seniors & Friends,

Warm Greetings!

 

This post of MCQ is on amendment on provisions in GST act which is giving effect to the changes in rate of tax in case of outdoor catering services.

 

Answer to MCQ 72.1: C) 18%.

 

Answer to MCQ 72.2: A) 5%.

 

Practical Analysis for MCQ 72.1& 72.2:-

  • As per notification no. 11/2017 central tax rate dated 28th June 2017 as amended by various notifications thereafter, the rate of tax for providing food or any other article for human consumption or any drink will be as follows –
ParticularsRate
Supply of food or any other article for human consumption or any drink provided by a restaurant, eating joint including mess, canteen5% with no ITC available.
Supply of food or any other article for human consumption or any drink in outdoor catering18%

 

  • But government vide Notification No. 13/2018 dated 26th July 2018 has brought an amendment in notification no. 11/2017 to restrict the scope of outdoor cateringin case of outdoor/indoor functions that are event based and occasional in nature.

 

  • The revised rates are as follows –

 

ParticularsRate
Supply of food or any other article for human consumption or any drink provided by a restaurant, eating joint including mess, canteen other than supplies covered below5% with no ITC available.
Supply of 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 nature18%

 

 

  • As per the amendment, now providing food, beverages in a marriage function would be treated as Outdoor catering and taxed @18% but providing daily food to a company for its employees on a contract basis is not a outdoor catering hence taxed @5% without the benefit of ITC.

 

  • These amendments are effective from 27th of July 2018.

 

  • The above amendments provides a major relief to the outdoor catering industry.

 

  • Based on the above analysis, correct answer MCQ 72.1: C) 18%.

 

  • Correct answer MCQ 72.2 : A) 5%.

 

(Disclaimer: The objective of the MCQ post is just to discuss the concept, it may happen, by change of facts, the answer may be different. Please do not treat this as professional opinion; you can definitely have your own opinion.)

 

Sincere Regards!

 

CA Sanjay Kumar Agrawal

Mobile: 9810116321 Whatsapp: 8799772245

 

To access MCQ posts regularly, please Join Telegram Channel:
https://t.me/caSanjayKumarAgrawal

 

For All MCQ post please click on:

Webpage: http://www.casanjay.me/

Facebook: https://www.facebook.com/CA.Sanjay.K.Agrawal/

Linkedin: https://www.linkedin.com/in/ca-sanjay-kumar-agrawal/

 

#CASanjay #MrCA #MsCA #MCQ #CharteredAccountants  #CharteredAccountant #CA #India #SmartCA

Please Post Your Comments & Reviews

Your email address will not be published. Required fields are marked *