GST IMPLICATION ON PIZZA FRANCHISEE RESTAURANT/HOTEL

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This query is : Resolved

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This discussion clarifies GST implications for pizza franchisees. It explores input tax credit (ITC) availability on machinery, the tax treatment of sales through online platforms like Zomato, and ITC on food and beverages purchased locally. The advice hinges on whether the business is classified as supplying goods or services, with proportionate ITC available if both are involved. For Zomato sales, commission plus GST is payable, and ITC depends on the overall business classification.

AMAN MALLIK

AMAN MALLIK (Querist)
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20 August 2021 Respected Expert,

I have some queries on GST on Pizza Franchisee Business .

1. Is input Available on Machinery Installed for Making Pizza under Franchisee.
2. Business is also run through online portal like Zomato, on this tax is to be paid.
3. Is input is available on food/Bevrage which Purchase from Local market to serve the customer other than "Pizza".

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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20 August 2021 1 In case of 5% GST charged on sale of Pizza no ITC can be claimed.
2 yes, 18% tax in payable on their service charges.
3 yes ITC available if GST charged on such sale is more than 5%

CA Altamush Zafar

CA Altamush Zafar (Expert)
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22 August 2021 It depends whether you are supplying service or goods. If you are supplying service in nature of restaurant then ITC is not available on anything.
If you are in the business of supplying of goods only then ITC is available.
If you are engaged in both then proportionate ITC is available.
As far as Zomato is concerned they will charge you commission plus GST which you will have to pay. ITC will depend on the explanation given by me above.

Lekhraj sood

Lekhraj sood (Expert)
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24 August 2021 I agree with CA R SEETHARAMAN ji for 1st 2 points. For the 3rd point , ITC will be available in the same line of business even if tax is charged at the rate of 5%.

AMAN MALLIK

AMAN MALLIK (Querist)
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27 August 2021 Sir, Pizza Co, supply whole Material of Pizza , Franchisee holder only make the product and Rate was Fixed by Pizza Co. suppose 110/ Pizza, Is tax is Payable on Tax. Value i.e 104.76 (@5%) without Claiming ITC on Supply of Material by Pizza co .

CA Altamush Zafar

CA Altamush Zafar (Expert)
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27 August 2021 Yes gst is payable........

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