Mumbai: Two years ago, actor Rahul Bose broke the internet when he tweeted that he was charged Rs 442.5 (including goods & services taxes, or GST) for two bananas in the famous five-star hotel in Chandigarh.
This has caused a question by the authorities of the GST and finally a fine was charged at the hotel because fruits did not attract GST.
But, and there is a big but involved, if fruits are sliced and diced and served to customers in a closed bowl, they will attract GST at 5%.
The Karnataka authority for the Face Decision (AAR), who passed this decision, did not deal with examples of fruits served in a hotel, but fruits were supplied by Juzi Fruits, a private company in Bengaluru.
The company is involved in the next purchase and supply of fresh fruits in a bowl (with or without the addition of fruit & dried beans).
This process involves washing, cleaning, peeling and dicing (if necessary) from fruits and packing it in a sealed bowl for consumption ready to use.
No preservatives or additives added.
Only excess oxygen in a bowl is removed to extend the life of fruits, and the bowl is covered in transparent films.
While edible fruits do not attract GST, Aar Bench argues that this fruit bowl, which is sold with a brand name, will attract GST at a 5% level under the entry number 59 of the schedule 1.
If fresh fruits are sold with fruit Dry fruits & nuts, then it will become a mixed supply and attract GST at a higher level apply to fruits or dry fruits & nuts.
In the absence of specific details of dried fruit & nuts used, the AAR bench refused to determine the GST level.
The bench added that Juzi fruit will be entitled to include tax credits for GST borne by the purchase and related costs.
Branded bowls from fresh fruits to face 5% GST
