GST on Sale of PaniPuri

a) Is GST Applicable to a Panipuri Selling Vendor?

  • GST is applicable based on the aggregate turnover of your business.
  • Food items like panipuri fall under the GST ambit if the aggregate turnover exceeds the exemption threshold.
  • Threshold Limit:
    • For Services: The threshold is ₹20 lakhs (₹10 lakhs for special category states).
    • For Goods: The threshold for GST registration was increased to ₹40 lakhs (as per Notification No. 10/2019-Central Tax, dated March 7, 2019), applicable in states like Tamil Nadu.
  • If vendor is
    • selling on street, it is service and threshold limit is ₹20 lakhs and
    • if the Panipuri is sold as Goods i.e Manufactured and sold to Street Food Vendors threshold limit is ₹40 lakhs.

b) At What Point Should You Register for GST and what are the compliances?

  • Regsitration
    • You are required to register for GST if your aggregate turnover exceeds ₹20 lakhs or ₹40 lakhs. as the case may be specified above.
    • Registration should have been done within 30 days from the date your turnover crossed the applicable threshold on the GST portal (www.gst.gov.in).
  • Decide Between Regular and Composition Scheme:
    • If you want simpler compliance and your turnover is below ₹1.5 crore, opt for the Composition Scheme.
    • If you want to claim Input Tax Credit (ITC), choose the Regular Scheme.
  • Comply with GST Filing Requirements:
    • Regular Scheme: File monthly GSTR-1 and GSTR-3B.
    • Composition Scheme: File quarterly CMP-08 and annual GSTR-4.

c) How Much is Your GST Liability?

  1. GST Rate for Panipuri:
    • Prepared food items like panipuri attract 5% GST (2.5% CGST + 2.5% SGST) as per Notification No. 11/2017-Central Tax (Rate) dated June 28, 2017​.
    • HSN Code for Panipuri if sold as GOODS: Panipuri falls under the category of “Prepared foods” or “Food supplied at restaurants, including takeaways” and is typically classified under HSN Code 2106, which covers miscellaneous edible preparations.
  2. Calculation of Liability:
    • Assuming your entire turnover is taxable and there are no exemptions, your GST liability is:
    • GST Liability= Taxable Turnover × GST Rate
      • ₹40,00,000×5%=₹2,00,000 if the registration is taken on day 1
      • ₹20,00,000×5%=₹1,00,000 if the registration is obtained after the thres hold limit of Rs. 20 lacs
    • This amount must be paid after registration and filing the appropriate GST returns.

Additional Notes:

  • If you are eligible and wish to opt for the Composition Scheme, you can pay GST at 1% of your turnover for Goods and 5% of your as restaurant Services , but Input Tax Credit (ITC) will not be available, and you cannot collect GST from your customers.

Recommendation: For better compliance and to avoid penalties, consult a GST professional or Chartered Accountant.

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