BAR AND RESTAURANT

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This query is : Resolved

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This discussion addresses whether a bar selling liquor (exempt from GST) and offering free soda, water, and snacks is liable for GST on these complimentary items. The consensus suggests that GST is not directly applicable to the free supplies themselves, but input tax credit (ITC) on them cannot be claimed. It's advised to invoice liquor and snacks separately, even if snacks are free, to avoid potential classification as mixed supplies and subsequent GST implications.

PARAS CHHAJED

PARAS CHHAJED

(Querist)

05 November 2021 A person who is holding FL 3 licence is running a liquor bar wherein he charges only for liquor and makes free supply of soda, water and small pouches of snacks to customers sitting in bar to consume liquor.

Alcoholic liquor for human consumption is out of purview of GST.

Whether prolong soda, water and snacks free of cost to bar customers would make him liable to pay GST on such items or whether the difference between purchase and sales of liquor would be considered as service and will be liable to GST.

Please guide.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

05 November 2021 GST not applicable on such free supply only ITC can't be claimed on such free supply.
VAT applicable on selling price of liquior ITC on VAT can be claimed.

CA Altamush Zafar

CA Altamush Zafar (Expert)

05 November 2021 Better make a different invoice for liquor and other snacks. If snacks are being provided free still make a invoice of 100% discount otherwise it may get classified as mixed supplies and GST could get applicable.

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