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2019 (10) TMI 1187 - AAR - GSTLevy of GST - HealthCare Services - medicines, consumables, surgical and implants used in the course of providing health care services to patients admitted to the Hospital for diagnosis or treatment would be considered as “Composite Supply” of health care services under GST - exemption under N/N. 12/2017 read with section 8 (a) of GST - ITC eligibility for obligatory services provided to in-patients through outsourcing - Circular No 32/06/2018-GST dl 12.02.2018. HELD THAT:- Inpatient services means services provided by hospitals to inpatients under the direction of medical doctors aimed at curing, restoring and/or maintaining the health of a patient and the service comprises of medical, pharmaceutical and paramedical services, rehabilitation services, nursing services and laboratory and technical services. A complete gamut of activities required for well-being of a patient and provided by a hospital under the direction of medical doctors is a composite supply of service and is covered under Inpatient services’ classifiable under SAC 999311. Health care services provided by a clinical establishment or an authorized medical practitioner or para medics are exempted vide SI No 74 of Notification no 12/2017-C.T.(rate) dated 28.06.2017 as amended and SI No 74 of Notification No.II(2)/CTR/532(d-15)/2017 vide G.O. (Ms) No. 73 dated 29.06.2017. From a joint reading of the ‘Explanation of service’ pertaining to “Inpatient services’ and the exemption above, it is evident that the exemption is applicable to a “Clinical Establishment”, when services by way of diagnosis or treatment or care for illness, etc. are undertaken by such establishment under the directions of a medical doctor. The applicant is a Clinical Establishment and for the health care services as defined in the Notification above is provided including the supply of medicines, implants and consumables, they are exempt under SI No 74 of Notification no 12/2017-C.T. (rate) dated 28.06.2017 as amended and SI No 74 of Notification No.II (2)/CTR/532(d-15)/2017 vide G.O. (Ms) No. 73 dated 29.06.2017. Eligibility of Input Tax credit of GST paid by the applicant on the inward services received by them - HELD THAT:- On perusal of the various bills, copies of which is furnished by the applicant, it is seen that except for supply of medicines by the out-patient pharmacy, no other bills has GST component in the bill, i.e, GST is not charged in any of the output supplies made by the applicant other than supply of medicines to out-patients from out-patient pharmacy. The taxable output supply made by the applicant is the supply of medicine from the out-patient pharmacy. The eligibility of credit of tax paid on the Input services used for providing taxable and exempt supplies stands governed under Section 17(2) of the CGST/TNGST Act 2017 read with Rule 42 of the CGST Rules 2017 as amended. Thus, the applicant is not eligible for the credit of tax paid on the Input services used exclusively for providing exempt services of health services to in patients such as laundry services used for inpatient. In respect of input services such as housekeeping, leasing of equipment used for both exempt supply of health services to in patients and taxable supply of medicines etc. to outpatients , the appropriate ITC eligible is determined by the above Rule 42 of the CGST Rules 2017 and TNSGST Rules as amended.
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