GST Rate on Ice Cream for Ice Cream Parlors vs. Restaurant

P GUNAPALAN (PROPREITOR) (59 Points)

14 October 2021  

The recent Circular No. 164 /20 /2021-GST from CBIC dated 6th October, 2021 has clarified that all ice cream parlours “would attract GST at the rate of 18%”. The circular also states that “Ice cream parlors sell already manufactured ice- cream and they do not have a character of a restaurant” and that “supply of ice-cream parlor stands on a different footing than restaurant service. Their activity entails supply of ice cream as goods (a manufactured item) and not as a service,”.

I have the following questions:
 

  1. What is the date of applicability of this clarification, i.e. from which date are ice cream parlours expected to pay GST at 18%? Is a retrospective charge from Nov 2017 possible?
     
  2. Will ice cream parlours who operate like a restaurant and provide table service fall under this ruling?
     
  3. In case ice cream parlours are treated as dealing in supply of goods, can they opt for GST composition scheme and pay GST at the rate of 1%, in cases where turnover is below 1.5 Crore per annum?