12 July 2017
Sir, Many are of the view that the bakers are considered are traders and hence rate applicable is 1%. But i have a query that bakers first manufactures then trade the goods. Hence i am of the view that the rate applicable is 5%. according to the GST composition rules 2.5 % is the rate applicable for Suppliers making supplies referred to in clause (b) of paragraph 6 of Schedule II.
clause (b) of paragraph 6 of Schedule II read as follows. (b) supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration. Kindly resolve my doubt
12 July 2017
Baking will not fall under manufacturing it is only preparing the food for which no excise duty paid earlier so GST 1% applicable. Later part you are referring to food supply in restaurant where 5% GST applicable under composition scheme.
12 July 2017
But previously Cake & pastry products are covered under chapter 19 of the central excise tariff,1985 and the rate was 16%. and for some other products the rate may be nil but excisable. further under section 2(72) of the CGST act "manufacture mean processing of raw material or inputs in any manner that results in emergence of a new product having a distinct name, character and use and the term “manufacturer” shall be construed accordingly;
Hence i feel even the bakery products satisfy the above condition and shall be construed as manufacture only right
CAclubindia
