Recently, Karnataka AAR has held that refund equivalent to 50% of GST amount in terms of Notification No. 6/2017 Central Tax(Rate), is allowed only to military canteens not to Other Canteens running by Central Armed Police Force (CAPF) inlcuding CRPF, CISF etc.
Language of Notification is as follows:
In exercise of the powers conferred by section 55 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby specifies the Canteen Stores Department (hereinafter referred to as the CSD), under the Ministry of Defence, as a person who shall be entitled to claim a refund of fifty per cent. of the applicable central tax paid by it on allinward supplies of goods received by it for the purposes of subsequent supply of such goods to the Unit Run Canteens of the CSD or to the authorized customers of the CSD.
Further, in terms of Notification No. 7/2017 Central Tax (Rate), there is no GST on Supply of Goods by:
The supply of goods by the CSD to the Unit Run Canteens
The supply of goods by the CSD to the authorized customers
The supply of goods by the Unit Run Canteens to the authorized customers
This notification has also been interpreted in terms of N.No. 6/2017 and it has been held that Canteens other than military are not coeverd in N.No. 7/2017.
In this regards, a circular has also been issued for explaining the procedure for Refund mechanism which can be read at : Circular No. 60/34/2018.
Copy of the Judgement
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Disclaimer: We did interpretation of Respected Authority Decision for purely academic purpose. In case, there is any mistake in understanding of the order, we are apologised to the Authority.