The Federation of Hotel and Restaurant Associations of India (FHRAI) on Tuesday responded to a Chandigarh five-star hotel adding 18 % Goods and Service Tax (GST) on bananas requested by actor Rahul Bose, naming it as nothing unlawful in it.
Mr. Bose had posted a video on July 22 on Twitter with a bill of ₹442 assigned by the hotel for two bananas. FHRAI in its explanation stated that adding 18 % GST was a lawful requirement to the hotel. The Excise and Taxation Department of the Union Territory of Chandigarh later started an inquiry and fined the hotel for ₹ 25,000 for infringement of area 11 of CGST (unlawful tax collection on an exempted thing).
"Chain hotels have a presence across several cities and pursue Standard Operating Procedures (SOPs). We have to comprehend that the hotel isn't occupied with the purchase and sale of fruits and vegetables however it gives services of the accommodation. Dissimilar to a retail location where bananas can be obtained at market value, a hotel offers service, quality, plate, cutlery, accompaniment, sanitized fruits, ambiance and luxury and not the item alone. A coffee accessible at ten rupees at a roadside stall could be served at ₹250 in a luxury hotel," Gurbaxish Singh Kohli, VP, FHRAI said.
FHRAI likewise explained that the hotel has made the best decision by adding 18 % GST on F&B served in its premises. GST laws, FHRAI stated, are not discretionary, yet are to be passed to the client and further on to the administration according to arrangements of the law. It further said that the rate for supply of administrations including products by an eatery is 9 % CGST and 9 % UT GST (since it was Chandigarh, an association domain). The hotel guaranteed that the hotel has effectively added the GST on the bill which was legitimately payable by the client.
Be that as it may, the higher authorities have issued an advisory note on approaches to deal with such circumstances where a visitor may have requested eatables, including fruits from outside the menu.
"Our quick concern is not to repeat the situation again. We don't want our guests to encounter a circumstance like this and are pondering on potential measures that hotels could take. We will encourage our individuals to advise the staff regarding the matter and will encourage necessary steps to maintain a strategic distance from such happenings later on," D V S Somaraju, honorary treasurer, FHRAI said.
After Mr. Rahul Bose posted the video, and it circulated around the web, a few Indian brands like Nature's Basket, Pizza Hut, Reliance Smart, Taj Santacruz and Oyo Rooms toward the Western Railways likewise took to social media by sharing hilarious memes and leaving netizens in splits.
Watch the video right below.