Appellate Authority for Advance Rulings, State of Uttarakhand GST: The Coram of P.K. Goel (CGST Member) and Dr Ahmed Iqbal (SGST Member) stated that a resort running the service of Naturopathy as an additional service would not be exempted from GST.

An appeal was filed under Section 100 of the Central Goods & Service Tax Act, 2017 and Uttarakhand Goods & Service Tax Act, 2017 by M/s Corbett Nature Reserves (Applicant) against the Advance Ruling Order passed by AAR of Uttarakhand.

Factual Background

Advance Ruling on the following Question was sought:

Whether “The Centre” of the applicant was eligible to get the benefit of entry 74 of exemption Notification No. 12/2017-Central Tax (Rate) classified under SAC Heading 9993?

The applicant was running a resort namely “Aahana – The Corbett Wilderness” and it was stated that the same runs an independent unit namely “Aahana Naturopathy Centre” wherein services in the form of Nature cure and Yoga therapies were provided, which were not restricted to the in-house customers, but open to all.

The Authority for Advance Ruling, Uttarakhand observed that the supply of services provided by the applicant, was a composite supply, rightly classifiable under sub-heading No. 996311 as ‘Room or unit accommodation services provided by Hotels, Inn, Guest House, Club and the like’, whereas the exemption at Entry 74 was applicable to services falling under SAC 9993. Therefore, the AAR held that the applicant was not eligible to get the benefit of Entry 74 of Exemption Notification No. 12/2017-Central Tax (Rate) dated 28-6-2017.

On being aggrieved with the above, the present appeal was filed.

Analysis and Decision

In the instant matter, the applicant had advertised and marketed their accommodation service as their main service and Naturopathy as an additional service.

Hence, the accommodation service and other services including Naturopathy rendered during the course of said service would be covered under the composite service and the accommodation service constituted the predominant element and therefore, the principal supply and other services including Naturopathy shall form the part of that composite supply.

Therefore, all the services provided in relation to or in addition to accommodation service were liable to GST applicable to ‘Accommodation Service’.[Corbett Nature Reserve, In Re., 2022 SCC OnLine Utt AAAR-GST 1, decided on 10-3-2022]

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