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Circular No. 85/04/2019- GST

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F. No. 354/428/2018-TRU
Government of India
Ministry of Finance
Department of Revenue
Tax research Unit
****
Room No. 156, North Block,
New Delhi, the 1
st
January, 2019
To,
The Principal Chief Commissioners/ Chief Commissioners/ Principal
Commissioners/ Commissioner of Central Tax (All) /
The Principal Director Generals/ Director Generals (All)

Madam/Sir,
Subject: Clarification on GST rate applicable on supply of food and beverage services
by educational institution- reg.

Representations have been received seeking clarification as to the rate of GST
applicable on supply of food and beverages services by educational institution to its students.
It has been stated that the words “school, college” appearing in Explanation 1 to Entry 7 (i)
of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 give rise to doubt whether
supply of food and drinks by an educational institution to its students is eligible for exemption
under Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 Sl. No 66, which
exempts services provided by an educational institution to its students, faculty and staff.
2. The matter has been examined. Notification No. 11/2017-Central Tax (Rate) dated
28.06.2017, Sl. No. 7(i) prescribes GST rate of 5% on supply of food and beverages services.
Explanation 1 to the said entry states that such supply can take place at canteen, mess,
cafeteria of an institution such as school, college, hospitals etc. On the other hand,
Notification No. 12/2017-Central Tax (Rate), Sl. No. 66 (a) exempts services provided by an
educational institution to its students, faculty and staff. There is no conflict between the two
entries. Entries in Notification No. 11/2017-Central Tax (Rate) prescribing GST rates on
service have to be read together with entries in exemption Notification No. 12/2017-Central
Tax (Rate) dated 28.06.2017. A supply which is specifically covered by any entry of
Notification No. 12/2017-Central Tax (Rate) dated 28-06-2017 is exempt from GST
notwithstanding the fact that GST rate has been prescribed for the same under Notification
No. 11/2017-Central Tax (Rate) dated 28.06.2017.

Circular No. 85/04/2019- GST

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2.1 Supply of all services by an educational institution to its students, faculty and staff is
exempt under Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, Sl. No. 66.
Such services include supply of food and beverages by an educational institution to its
students, faculty and staff. As stated in explanation 3 (ii) to Notification No. 12/2017-Central
Tax (Rate) dated 28.06.2017 Chapter, Section, Heading, Group or Service Codes mentioned
in column (2) of the table in Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017
are only indicative. A supply is eligible for exemption under an entry of the said notification
where the description given in column (3) of the table leaves no room for any doubt.
Accordingly, it is clarified that supply of food and beverages by an educational institution to
its students, faculty and staff, where such supply is made by the educational institution itself,
is exempt under Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, vide Sl. No.
66 w.e.f. 01-07-2017 itself. However, such supply of food and beverages by any person other
than the educational institutions based on a contractual arrangement with such institution is
leviable to GST@ 5%.
3. In order to remove any doubts on the issue, Explanation 1 to Entry 7(i) of Notification
No. 11/2017-Central Tax (Rate) dated 28.06.2017 has been amended vide Notification No.
27/2018-Central Tax (Rate) dated 31.12.2018 to omit from it the words “school, college”.
Further, heading 9963 has been added in Column (2) against entry at Sl. No. 66 of Notification
No. 12/2017-Central Tax (Rate) dated 28.06.2017, vide Notification No. 28/2018-Central Tax
(Rate) dated 31.12.2018.
4. Difficulty, if any, in implementation of this Circular may be brought to the notice of
the Board.
Yours Faithfully,

(Harish Y N)
Technical Officer, TRU
Email: harish.yn@gov.in
Tel: 011 2309 5547