AAR Karnataka Order in case of M/s Barbeque Nation Hospitality Ltd.

Case Covered:

M/s Barbeque Nation Hospitality Ltd.

Facts of the case:

The applicant, engaged in the hospitality industry, took the premises, on a lease, measuring 5773 sq. ft. of super built-up area on the first floor of the commercial building known as ”Prestige Plaza” situated at Yelahanka, Bengaluru, under the lease deed dated 08.03.2019, to run the restaurant and food catering services. The applicant is required to pay ‘rent’, ‘car parking charges’, ‘security deposits’, ‘DG consumption charges’ and ‘maintenance charges’ and the applicable GST thereon.

The applicant is required to reimburse the ”Electricity Charges”, for electricity consumed, at actuals, in terms of clause 13.1 of the lease deed. The lessors raise a monthly invoice for electricity charges, energy tax, and demand charges, referring together as ”Electricity Charges”, charging GST @ 18%. The applicant raises the objection for charging GST on the said charges and questions the lessors about the legal authority/ source of law. In view of the above, the applicant filed the instant application for advance ruling.

Section 95(a) of the CGST Act, 2017, while defining the term ‘advance ruling’, stipulates that an applicant can seek advance ruling on the questions specified under Section 97(2) of the CGST Act, 2017, in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the said applicant. In the instant case the questions, on which the applicant seeks an advance ruling, are not in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the said applicant, but in relation to the service/s being received by them. Therefore the instant application is beyond the jurisdiction of this authority and hence is liable for rejection.

In view of the above, we passed the following:

Ruling:

The application filed by the Applicant for advance ruling is rejected, in terms of Section 98(2) of the CGST Act, 2017.

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