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Police Canteens are not Exempt from GST and also not eligible for 50% GST Refund which is available to CSD canteens (military)

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.

Now Considering this, "Home ministry has now issued an order saying that 50% GST waiver will be given for purchases made at KPKB’s and the waiver will be borne by Home ministry via its budgetary allocation," sources said...This will not be from GST Department.

Copy of the Judgement

Download PDF • 3.11MB

Disclaimer: We have taken due care to the best of our knowledge while explaining the provisions surrounding the issue purely for informational/academic purpose. It should not be considered as professional advice or consultancy to be relied upon. While due care has been taken by Fab Gyan in preparing this article, certain mistakes and omissions may creep in. The Fab Gyan or its Author does not accept any liability for any loss or damage of any kind arising out of any inaccurate or incomplete information in this document nor for any actions taken in reliance thereon.

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.

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