In a case that is seen to have a significant impact on restaurant chains and bakery businesses as well as several industries that rely on the classification of food services under the goods and services tax, the Bombay High Court has said that for now no coercive action will be initiated against Mad Over Donuts by the tax authorities on the disputed classification. The Bombay High Court has also granted the petitioner –Mad Over Donuts (Himesh Foods), the liberty to approach the bench in case any recovery actions are taken by the GST department. In its recent hearing, the Court has also directed the tax department to file its response by March 17. The matter is scheduled for further hearing on March 24. The case pertains to notices for GST sent to Himesh Foods as well as several other donut and bakery chains seeking 18% GST on sale of donuts and bakery items. The challenge arose as these chains contend that GST is to be paid at 5% as the sale of these products fall under restaurant services. The case is being heard by a bench comprising Justice BP Colabawalla and Justice FP Pooniwalla on whether the supply of donuts falls within the ambit of restaurant services under Service Accounting Code (SAC) 9963 or should be categorised as a bakery product subject to separate tax treatment under the Goods and Services Tax (GST) framework. Representing the petitioner, Mad Over Donuts (Himesh Foods), Abhishek A Rastogi contended that the supply of food or other edible articles qualifies as a composite supply of services under the Central GST Act. He also pointed out that the relevant GST rate notifications explicitly define restaurant services to include food supplied at restaurants, eating joints, messes, and canteens, whether for consumption on the premises or as takeaway. He also argued that official circular supports this interpretation by confirming that takeaway services should be classified as services and taxed at 5%. The Bombay High Court is also looking into another crucial aspect as part of the case on the issue of multiplicity of proceedings across different territorial jurisdictions. The bench examined whether a centralized show-cause notice (SCN) issued by the Directorate General of GST Intelligence (DGGI) suffices or whether separate notices need to be issued for each GST registration.