The GSTAT Hyderabad has ruled that caterers supplying food to hospital patients are liable for Goods and Services Tax (GST). This judgment came in the case of Shivenari Canteen Services, which supplied food to MGM Hospital in Warangal, Telangana.
According to TaxCorp AI, the case, Boilla Venkataramana Reddy Vs Shivenari Canteen Services, arose from a dispute and was appealed under Section 112(3) and Section 112(4) of the Central Goods & Services Tax Act, 2017.
The core controversy centered on whether the food supplies by Shivenari Canteen Services to in-patients of MGM Hospital could be treated as an exempt composite supply of healthcare services or independently taxable as restaurant services under GST.
The period in dispute spanned from January 2018 to November 2021. During this time, the Respondent supplied food within the hospital premises under a formal agreement with MGM Hospital.
The adjudicating authority (AA) had held such supplies taxable as “Restaurant Services” and raised a demand of ₹23,04,026 for the disputed period, as reported by TaxCorp AI.
This ruling is significant for hospitals and entities providing catering services to them across Andhra Pradesh and Telangana. It provides clarity on the applicability of GST to hospital catering services, impacting business operations in the region.
