Sweet Shop Cum Restaurant

In the case of Sweet Shop cum restaurant, the services from the restaurant is a principle supply which provides a bundled supply of preparation & sale of food and serving the same and therefore it constitutes a composite supply. In the instant case, the nature of restaurant services is such that it may be treated as the main supply and the other supplies Combined with such main supply are in the nature of incidental or services. Thus restaurant services get the character of predominant supply over other supplies. Therefore in the present case the supply shall be treated as a supply of service and the sweet shop shall be an extension of the restaurant. Thus the supply of pure food, namkeen, cold drink and other edible items from a sweet Shop which also runs a restaurant is a transaction of supply of service.
This will fall under the HSN 9963 and a Rate Of 5% Shall be Applicable without any Input Credit.

-Krishna Bansal