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Taxation Delhi Ministry of Finance Delhi Goods and Services Tax Act, 2017

Clarifications regarding applicability of GST on certain services

31-Aug-2023 | F.3 (514)/GST/Policy/2023/ 921-927

Government of Delhi has issued a Circular addressing the CBIC (Central Board of Indirect Taxes and Customs) Circular no. 201/12/2023-GST dated 1st August 2023, which provides clarification regarding the applicability of GST on certain services.

Key Clarifications from the Circular:

1. Whether services supplied by director of a company in his personal capacity such as renting of immovable property to the company or body corporate are subject to Reverse Charge mechanism:

Services provided by a director of a company or body corporate to the same company or body corporate in their personal capacity, such as renting of immovable property, are not subject to the Reverse Charge Mechanism (RCM). Only those services provided by a director in their capacity as a director of the company or body corporate are taxable under RCM.


2. Whether supply of food or beverages in cinema hall is taxable as restaurant service: Supply of food or beverages within a cinema hall is considered taxable as a restaurant service if the following conditions are met:

a) The food or beverages are supplied as part of a service.
b) The supply is separate from the cinema exhibition service.
Bundled Supply in Cinema Halls:

If the sale of cinema tickets and the supply of food and beverages are bundled together, and this bundled supply qualifies as a composite supply, the entire supply will be subject to GST at the rate applicable to the principal supply, which is the service of exhibiting the cinema.

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