The Delhi Appellate Authority for Advance Rulings (AAAR) has apprehended that a uniform 5% goods and services tax (GST) will apply on food served in trains or on railway platforms.
Ending the controversy, it said this rate would be applicable regardless of whether the food is served by a railway-licensed caterer or not. The AAAR bench also added that the supply of newspapers on trains would be exempt from GST.
Earlier, the Authority for Advance Rulings (AAR) had held that GST should be charged on individual items at their applicable rates. Further, there could have been different GST rates applicable based on whether the service was in trains or on platforms.
The challenges that this ruling threw up prompted Deepak & Co (the appellant) to file an appeal. This entity had entered into agreements with the Indian Railways for the supply of food to passengers on Rajdhani trains as well as Mail and Express trains. Additionally, it supplied food through food plazas at railway stations.