Corporate Food Supply Classified Under SAC 996337

Centax Editorial Board

June 27, 2026June 28, 2026

• 2 min. read

Case Details: In re: Frutta Services Pvt. Ltd. (2026) 43 Centax 316 (App. A.A.R. - GST - T.N.)

Judiciary and Counsel Details

- Madan Mohan Singh & S. Nagarajan, Member
- S/Shri Kaveyan K., Director, Sundaresan R., Co-Founder & Gomathisankar S., Head of Finance, for the Applicant.

Facts of the Case

The appellant supplied food and beverages to corporate clients for distribution to their employees. The food was procured from third-party kitchens and delivered to the clients’ premises through outsourced logistics. Although the appellant did not cook the food or operate any restaurant premises, it was responsible for menu planning with the partner kitchens, quality checks on hygiene, monitoring compliance with service standards and deploying service personnel at the clients’ premises under service contracts. The Authority for Advance Ruling (AAR) held that the supply did not qualify as restaurant service and was taxable at 18%. Aggrieved by the ruling, the appellant filed an appeal before the Appellate Authority for Advance Ruling (AAAR).

AAAR Held

The AAAR held that the appellant was not merely an aggregator, as its role extended beyond procuring and supplying food to include menu planning, quality control, and the deployment of service personnel. It further held that the supply was neither a restaurant service, since the appellant neither operated restaurant premises nor cooked the food, nor an outdoor catering service, as the supply was not event-based and did not involve preparation of food. Accordingly, the services were classifiable under Heading 9963, SAC 996337 as “other contract food services” and were liable to GST at 18%. The concessional GST rate of 5% applicable to restaurant services was therefore held to be inapplicable.