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The Central Board of Indirect Taxes and Customs issues a corrigendum to modify text in Circular No. 28/02/2018-GST regarding catering services provided to educational institutions. The correction clarifies that catering services provided directly by an educational institution to its students, faculty, and staff are exempt under notification No. 12/2017-Central Tax (Rate). The correction also establishes that catering services provided by anyone other than the educational institution attract a Goods and Services Tax rate of five percent under entry 7(i) of notification No. 11/2017-CT (Rate) if the credit of input tax charged on goods and services used in supplying the service is not taken.
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F. No. 354/03/2018 Government of India Ministry of Finance Department of Revenue Tax research Unit
Room No. 156, North Block, New Delhi, 18th January 2018
To,
The Principal Chief Commissioners/ Chief Commissioners/ Principal Commissioners/ Commissioner of Central Tax (All) / The Principal Director Generals/ Director Generals (All)
Madam/Sir,
Subject: Corrigendum to Circular No. 28/02/2018-GST dated 08th January 2018 issued vide F.No. 354/03/2018 - reg.
In Para 2 of the said circular,
for
"It is immaterial whether the service is provided by the educational institution itself or the institution outsources the activity to an outside contractor."
read,
"2.1 If the catering services is one of the services provided by an educational institution to its students, faculty and staff and the said educational institution is covered by the definition given under para 2(y) of notification No. 12/2017-Central Tax (Rate), then the same is exempt. [Sl. No. 66(a) of notification No. 12/2017-Central Tax (Rate) refers]
2.2 If the catering services, i.e., supply of food or drink in a mess or canteen, is provided by anyone other than the educational institution, then it is a supply of service at entry 7(i) of notification No. 11/2017-CT (Rate) [as amended vide notification No. 46/2017-CT (Rate) dated 14.11.2017] to the concerned educational institution and attracts GST of 5% provided that credit of input tax charged on goods and services used in supplying the service has not been taken, effective from 15.11.2017."
Yours Faithfully,
Rachna Technical Officer (TRU) Email: rachna.irs@gov.in
