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TMI Blog2018 (10) TMI 681X X X X Extracts X X X X X X X X Extracts X X X X ..... and when the relevant QP/NOS would be defined by NSDC. In the interim period, NSDC has given exceptional approval on such courses. Till the time QP/NOS are defined or such educational courses and are eventually approved by NSDC, whether such courses will be treated as in relation to National Skill Development Programme implemented by NSDC?" Q.3.- "In certain situations, NSDC approved educational courses are subsequently, upgraded by the Applicant within pre-defined QP/ NOS framework, by way of adding more topics/ content/modules. However, such modified version of NSDC approved educational courses have not been approved by NSDC yet. Whether such modified version will be treated as in relation to National Skill Development Programme implemented by NSDC?" Q.4.- "If the answer to Q.1, Q.2 and Q.3 are Yes, then whether the benefit of GST exemption as per Notification No. 12/2017- Central Tax (Rate), dated the 28th June 2017 would be available to the Applicant?" Q.5.- "If answer to Q.4 is Yes, whether benefit of GST exemption as per Notification No. 12/2017- Central Tax (Rate), dated the 28th June 2017 would be still available if such educational courses are offered to corporates an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Electrical and Sales Person Retail. II.4 For imparting the aforesaid training, the Applicant has developed its own proprietary training formats, materials and methodology, which are conducted at its centers located in various cities and sometimes at location of business institutions and Govt. organisations. The clientele of the Applicant includes individuals, corporates, educational institutions, Govt. organizations. II.5. The technical and vocational educational courses offered by the Applicant are either funded by NSDC / Central Govt./ State Govt. or are paid up courses which are enrolled by individuals, corporates. II.6 Applicant is an approved training partner of NSDC and till date, 12 educational courses offered by it have been approved by NSDC. Further, 2 educational courses for which QP/NOS have not been defined by NSDC yet, have been conditionally approved by NSDC. All such courses offered by the Applicant are directed for skill development and to increase employability in India. II.7 The Applicant has tie-ups with various educational institutes / Govt. organizations, including NSDC, National Stock Exchange Academy, Symbiosis International University, Indira Institute o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ical training (10 CGSC Fitter Mechanical Assembly (11) Data Science (12) IFRS Copy of the approval received from NSDC in relation to all the aforesaid educational courses have been enclosed herewith as ''Exhibit 3." GST provisions IV.4. Entry 69 to the Notification No. 12/2017-Central Tax (Rate) dated 28th June 2017 ('the Notification') exempts from GST levy: Education services (specified under HSN 9992) provided by: (a) the National Skill Development Corporation set up by the Government of India; (b) a Sector Skill Council approved by the National Skill Development Corporation; (c) an assessment agency approved by the Sector Skill Council or the National Skill Development Corporation; (d) a training partner approved by the National Skill Development Corporation or the Sector Skill Council in relation to- (i) the National Skill Development Programme implemented by the National Skill Development Corporation; or (ii) a vocational skill development course under the National Skill Certification and Monetary Reward Scheme; or (iii) any other Scheme implemented by the National Skill Development Corporation transaction. Copy of the Notification has been enclosed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of such stakeholders, rather than undertaking initiatives directly and duplicating efforts. IV.10. It is evident from the above that, NSDC to achieve its objectives, does not undertake / implement any schemes, programmes on its own, rather, it has partnered with various training institutions imparting training courses /programmes related to skill development. IV-11. Basis the information available on NSDC portal (hereinafter referred to as 'SDMS'), we understand that the educational courses offered by NSDC training partners, should contain pre-defined qualification standards / knowledge parameters. In this regard, Ministry of Human Resource Development has designed and notified qualification assurance framework i.e. National Vocational Education Qualifications Framework (hereinafter referred to as 'NVEQF'), which outlines qualifications / levels / competencies of knowledge and skills that a learner must possess, for the purpose of getting any given job role. Within such NVEQF framework, for each job role within identified skill sectors, NSDC has specified different level of skills and learning outcomes i.e. various National Occupational Standards, Qualification Packs, (hereinafte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l year, in relation to each of the approved educational courses, the Applicant is required to report and upload the following details, on the SDMS (NSDC portal): * Applicant's progress towards yearly skill achievement targets; * Annual and monthly performance of the Applicant such as number of students enrolled, trained, placed, up- skilled; * Quarterly and yearly training and placements achievements of the Applicant; * Details of each and every student who was enrolled with the Applicant such as personal details, date of enrolment, date of passing out, batch start and end date, training status, etc.; * Status of active and inactive educational centres of the Applicant; * Details of corporate training programs; * Details of any other skilling schemes The documentary evidence of sharing the aforesaid information by the Applicant with NSDC has been enclosed herewith as 'Exhibit-8'. IV.18. Further, NSDC conducts candidate data validation exercise every year, in which details of each candidate reported by the Applicant on SDMS (NSDC portal) is validated and verified. Furthermore, NSDC in their emails sent to the Applicant for sharing information related to target achiev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has given exceptional approval on such courses. Till the time QP/ NOS are defined for such educational courses and are eventually approved by NSDC, whether such courses will be treated as in relation to National Skill Development Programme implemented by NSDC" V.2. As mentioned above under Para IV.11 to IV.13, NVEQF is qualification assurance framework that outlines different type of skill standards, a person should possess for a given job role and also, outlines learning outcomes to ensure particular target level of skill has been achieved in a training program. In this regard, NSDC has defined NOS / QP for many job roles. Such QP / NOS should be aligned to educational courses imparted by NSDC training partners. NSDC has defined QP / NOS for many job roles and they are in in process to outline QP / NOS for other job roles. NSDC's educational course approval process V.3. In connection to job role / educational course for which NOS / QPs has been already defined by NSDC, for the purpose of obtaining approval from NSDC, the approved training partner of NSDC is required to align their educational courses as per the listed QPs / NOS. V.4. At present, the step-by-step NSDC course ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... defined QP/ NOS framework, by way of adding more topics/ content /modules. However, such modified version of NSDC approved educational courses have not been approved by NSDC yet. Whether such modified version will be treated as in relation to National Skill Development Programme implemented by NSDC?" VI.1. The Applicant submits that in the present case, the Advance Ruling sought by the Applicant relates to the matter as to: "In certain situations, NSDC approved educational courses are subsequently, upgraded by the Applicant within pre-defined QP/ NOS framework, by way of adding more topics/ content/modules. However, such modified version of NSDC approved educational courses have not been approved by NSDC yet. Whether such modified version will be treated as in relation to National Skill Development Programme implemented by NSDC" VI.2. For the purpose of remaining competitive in this evolving and dynamic world, the Applicant keeps on upgrading, modifying, adding variants to its already approved educational courses, by way of adding more topics/ modules / content to the same. As result of such modification, the basic premise of such modified courses remains constant, existing mod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pment Corporation; (d) a training partner approved by the National Skill Development Corporation or the Sector Skill Council in relation to- (i) the National Skill Development Programme implemented by the National Skill Development Corporation; or (ii) a vocational skill development course under the National Skill Certification and Monetary Reward Scheme; or (iii) any Other Scheme implemented by the National Skill Development Corporation transaction Co-relation of the Notification with the facts of Applicant VII.3. The Applicant is training partner approved by NSDC. VII.4. As mentioned above under Paras IV.4 to IV_20, in absence of any specific National Skill Development Programme announced by NSDC as implemented by it, the educational courses offered by the Applicant which have been approved by NSDC, should be construed as in relation to National Skill Development Programme implemented by NSDC. VII.5. Further, as elucidated above under Paras V.2. to V-8. and Paras VI.2 to VI.7., the conditional approved educational courses and the modified versions of already approved educational courses respectively, should be equated as in relation to National Skill Development ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... restriction it is evident that as long as the educational courses offered by the approved training partner are in relation to the National Skill Development Programme implemented by NSDC, GST exemption would be available, irrespective of constitution of the recipient. VIII.6. The Applicant would like to submit that the educational courses which have been approved by NSDC and are reported to NSDC towards achievements of skill development targets of the Applicant and are in relation to the National Skill Development Programme implemented by NSDC, regardless of being offered to business corporates or colleges or individuals and GST exemption should be available on the same. IV. Question of law: (6) "Whether the NSDC approved educational courses which are actually imparted by the business partners of the Applicant, on behalf of the Applicant as sub-contractor of Applicant, at various centres located across the country, will be considered as offered by the Applicant?" IX.1. The Applicant submits that in the present case, the Advance Ruling sought by the Applicant relates to the matter as to: "Whether the NSDC approved educational courses which are actually imparted by the business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amme Structures for each academic year which business partner is required to follow and assist business partner in preparing time table for programme and services to be rendered in connection therewith. * The Applicant shall provide students course material application form, brochure, advertisement materials, student' s identity card, login credentials to access course material electronically, to the business partner who in turn will give the same to the students. * Business partner is required to maintain financial and Other records in the specified format, as required by the Applicant. * The premises that will be used by business partner under the said agreement would be acquired by the Applicant, under a lease arrangement. In other words, the centre will be taken on lease basis for which lease agreement is in the name of the Applicant and the lease rentals will be paid by the Applicant. * Business partner is required to make available requisite infrastructure such as office, classroom library, furniture, electricity, other amenities in the specified area as approved by the Applicant, which is mandatory for business partner to effectively render services for training stud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m, to business partner, to use its trade marks. IX.8. Further, the business partners receive fees for undertaking the abovementioned activities from the Applicant and raises invoice upon the Applicant. IX.9. ln light of the above, it is amply evident that, the Applicant has sub-contracted / outsourced few of its obligations of imparting educational services and training, to the business partners. Further, business partners are rendering services to the Applicant and not to the students, for which it is being compensated by the Applicant. IX.10. Since the educational courses imparted by business partners are on behalf of the Applicant, accordingly, such educational courses should be construed as being offered and conducted by the Applicant itself. IX.11. The Applicant would like to submit that the education courses which are conducted at centres managed and run by the business partner on behalf of the Applicant, are the same courses which have either been approved or conditionally approved by NSDC or the upgraded versions of such courses. Therefore, every year the Applicant has included such courses while reporting achievement of its skill development targets to NSDC and NSDC ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty that: * The educational courses approved by NSDC and conducted by the Applicant should be treated as is in relation to National Skill Development Programme implemented by NSDC. * The educational courses conducted by the Applicant which have been conditionally approved by NSDC should be treated as is in relation to National Skill Development Programme implemented by NSDC. * The upgraded versions of educational courses conducted by the Applicant which have been approved prior to modification by NSDC should be treated as is in relation to National Skill Development Programme implemented by NSDC. * The educational courses approved by NSDC and conducted by the business partners on behalf of the Applicant should be treated as is in relation to National Skill Development Programme implemented by NSDC. * The aforesaid courses should be exempt from levy of GST in terms of Notification No 12/2012 - Central tax (Rate) dated 28th June, 2017. * Any other or further relief as Hon'ble Authority deems fit, proper and reasonable, on the facts of the case, may be granted. * The Applicant be granted the opportunity of a personal hearing. 03. CONTENTION - AS PER THE CONCERNED OFFICER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anagement, Lovely Professional University, Chartered Financial Institute, Chartered Institute of Management Accountant. The applicant has raised following query:- Qs.No. Questions raised by the applicant Submission as per ACT & RULE 1. Whether educational courses offered by the applicant which have been approved by National Skill Development Corporation would be construed as in relation to National Skill Development Programme implemented by NSDC? Yes. As the applicant is engaged, in the business of skilling the youth with the objective of helping them find decent job, make them employable and to help them earn better living. It fulfils the norms of the NSDC. 2. The Applicant offers certain educational courses for which qualification standards/ framework i.e. QP/NOS has not been defined by NSDC and will be approved by NSDC as and when the relevant QP/NOS would be defined NSDC. In the interim period, NSDC has given exceptional approval on such courses. Till the time QP/NOS are defined for such educational courses and are eventually approved by NSDC, whether such courses will be treated as in relation to National Skill Development Programme implemented by NSDC? No comment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons? No. 6. Whether the NSDC approved educational courses which are actually imparted by the business partners of the Applicant, on behalf of the Applicant as sub-contractor of Applicant, at various centers located across the country, will be considered as offered by the Applicants? Should be approved by the NSDC not for sub-contract of the applicant. 7. If answer to Q.6 is Yes, whether benefit of GST exemption as per Notification No.12/2017-Central Tax (Rate), dated the 28th June 2017 would be available to the applicant? Should be approved by the NSDC not for sub-contract of the applicant. NSDC (BACKGROUND) : Skill India is an initiative of the Government of India which has been launched to empower the youth of the country with skill sets which make them more employable and more productive in their work environment. Our National Skill Mission is chaired by the Hon'ble Prime Minister, Shri Narendra Modi himself. India is a country today with 65% of its youth in the working age group. If ever there is a way to reap this demographic advantage, it has to be through skill development of the youth so that they add not only to their personal growth, but to the country's economic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oudhary CEO, Sh. Ajay Nayak, C.A., Sh. Tanveer Bhagat, C.A. appeared and made submissions orally for admission of application as per contentions made in ARA. They were orally requested to confirm and obtain in writing from NSDC as to what are the programmes that are being undertaken by NSDC under National Skill Development Programme and submit the same. Jurisdictional Officer, Ms. R. S. lyer Sales Tax Officer appeared and made written submissions. The application was admitted and called for final hearing on 24.04.2018, Sh. Santosh Dalvi, Advocate alongwith Ms. Shradha Didwania, Sh. Sanjay Choudhary CEO, Sh. Ajay Nayak, C.A., Sh. Tanveer Bhagat, C.A. and Ms. Aarti Shetty appeared and made oral contentions as per their written submissions which were taken on record, Jurisdictional Officer, Ms. R. S. lyer Sales Tax Officer appeared and stated that they have already made their written submissions. 05. OBSERVATIONS We have perused the records on file and have gone through the facts of the case and oral and written submissions made by the applicant as well as the department. We find that M/s. IMS Proschool Private Limited, the applicant is a company under the Companies Act. The app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... examine as to what is the exact nature and functions of NSDC and what services would be construed to be in relation to National Skill Development Programme implemented by NSDC. We find that Notification No. 12/2017-CT in respect of the present matter reads as under:- Notification No. 12/2017- Central Tax (Rate) New Delhi, the 28th June, 2017 G.SR......(E).- In exercise of the powers conferred by sub-section (1) of section 11 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council, hereby exempts the intra-State supply of services of description as specified in column (3) of the Table below from so much of the central tax leviable thereon under sub-section (I) of section 9 of the said Act, as is in excess of the said tax calculated at the rate as specified in the corresponding entry in column (4) of the said Table, unless specified otherwise, subject to the relevant conditions as specified in the corresponding entry in column (5) of the said Table. From the details of the relevant Notification we find that the applicant is claiming that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h partnerships. 3. It acts as a catalysing skill development by providing funding to enterprises, companies and organizations that provides skill training. 4. It also develops appropriate modules to enhance, support and coordinate private sector initiatives. Thus we find that NSDC was set up as a part of National Skill Development Mission to fulfil the growing need in India for skilled manpower across sectors and narrow the existing gap between the demand and supply of skills. Its main objective was and is to contribute significantly to the overall target of skilling up people in India mainly by fostering private sector initiatives in skill development, programmes and to provide funding. Further we find that The National Skill Development Mission was launched on 15th July, 2015 with the objective to provide overall institutional framework to rapidly implement and scale up the skill development efforts across India. The Ministry of Skill Development & Entrepreneurship, through the National Skill Development Corporation (NSDC), has taken up multiple initiatives to connect with industries for partnership under the larger Skill India Mission. NSDC has a single-window facilita ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ams and NSDC associated training partners in the private sector. For the first time in 68 years of India's independence, a Ministry for Skill Development & Entrepreneurship (MSDE) has been formed to focus on enhancing employability of the youth through skill development. The skill ecosystem in India, is seeing some great reforms and policy interventions which is reinvigorating and re-energising the country's workforce today; and is preparing the youth for job and growth opportunities in the international market. The Hon'ble Prime Minister's flagship scheme, Pradhan Mantri Kaushal Vikas Yojana (PMKVY) alone, has till date seen close to 20 lakh people get skilled and prepared for a new successful India. Skill India harbours responsibility for ensuring implementation of Common norms across all skill development programs in the country so that they are all standardized and aligned to one Object. The ITI ecosystem has also been brought under Skill India for garnering better results in vocational education and training. The success of a nation always depends on the success of its youth and Skill India is certain to bring a lot of advantage and opportunities for these young Indians. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Skill Certification and Monetary Reward Scheme (iii) Any other scheme implemented by the NSDC. Thus it is clearly stated by them that they are not covered and are not eligible for exemption under Sr No (ii) and (iii) as mentioned in Sr. No. 69 of Notification 12/2017-CentraI Tax. We find that the applicant is further claiming in their application that NSDC has not announced explicitly any course programme which would be considered as part of National Skill Development Programme implemented by NSDC, It is reiterated that at the time of hearing they were requested to confirm and obtain in writing from NSDC as to what are the programmes that are being undertaken by NSDC under National Skill Development Programme and submit the same. However nothing in this regard had been submitted by the applicant from NSDC. Therefore in absence of any explicit National Skill Development Programme which can be considered as implemented by NSDC, we need to examine and determine under what circumstances any programme/scheme/ educational course would qualify as in relation to National Skill Development Programme implemented by NSDC. Thus now after having a detailed look at the functions of NSD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e initiatives by its functional arms which are:- * National Skill Development Agency (NSDA). * National Skill Development Council (NSDC). * National Skill Development Fund (NSDF). * 33 Sector Skill Councils (SSCs) * 187 Training partners registered with NSDL We find that the National Policy on Skill Development and Entrepreneurship, 2015 provides as under:- "Scope of the National Skill Development Policy a) Institution based skill development including ITIs/ITCs/vocational schools/ technical schools/ polytechnics/ professional colleges, etc. b) Learning initiatives of sectoral skill development organized by different ministries/departments. c) Formal and informal apprenticeships and other types of training by enterprises. d) Training for self-employment/ entrepreneurial development. e) Adult learning, retraining of retired or retiring employees and lifelong learning. f) Non-formal training including training by civil society organisations. g) E- web-based learning and distance learning. The objective of the National Policy on Skill Development and Entrepreneurship, 2015 will be to meet the challenges of skilling at scale with speed and stan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ainable Livelihoods, (vii) Leveraging Public Infrastructure. Further we find that the functions of various organisations under or working in coordination with the Ministry of Skill Development and Entrepreneurship whose details in brief are as under:- 1. --- Directorate General of Training (DGT) The Directorate General of Training consists of the Directorate of Training and Directorate of Apprentice Training. This includes a network of Industrial Training Institutes (ITIs) in States; Advanced Training institutes (ATIs), Regional Vocational Training Institutes (RVTIs) and other central institutes. A number of training programmes catering to students, trainers and industry requirements are being run through this network. The building blocks for vocational training in the country - Industrial Training Institutes - play a vital role in the economy by providing skilled manpower in different sectors with varying levels of expertise. IT Is are affiliated by National Council for Vocational Training (NCVT). DGT also operationalises the amended Apprentices Act, 1961. 2.--- National Skill Development Agency (NSDA) The National Skill Development Agency (NSDA), an autonomous body, (re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . * 3. Enable: the creation and sustainability of support systems required for skill development. This includes the Industry led Sector Skill Councils. The main objectives of the NSDC are to: * Upgrade skills to international standards through significant industry involvement and develop necessary frameworks for standards, curriculum and quality assurance * Enhance, support and coordinate private sector initiatives for skill development through appropriate Public-Private Partnership (PPP) models; strive for significant operational and financial involvement from the private sector * Play the role of a "market-maker" by bringing financing, particularly in sectors where market mechanisms are ineffective or missing * Prioritize initiatives that can have a multiplier or catalytic effect as opposed to one-off impact. NSDC operates through partnerships with multiple stakeholders in catalysing and evolving the skilling ecosystem. * Private Sector - Areas of partnerships include awareness building, capacity creation, loan financing, creation and operations of Sector Skill Councils, assessment leading to certification, employment generation, Corporate Social Responsibil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - National Skill Development Fund The National Skill Development Fund was set up in 2009 by the Government of India for raising funds both from Government and Non Government sectors for skill development in the country. The Fund is contributed by various Government sources, and other donors/ contributors to enhance, stimulate and develop the skills of Indian youth by various sector specific programs. A public Trust set up by the Government of India is the custodian of the Fund. The Trust accepts donation, contribution in cash or kind from the Contributors for furtherance of objectives of the Fund. The Fund is operated and managed by the Board of Trustees. The Chief Executive Officer of the Trust is responsible for day-to- day administration and management of the Trust." 5.--- Indian Institute of Entrepreneurship (IIE) The Indian Institute of Entrepreneurship (IIE) was established in the year 1993 in Guwahati by the erstwhile Ministry of Industry (now the Ministry of Micro, Small and Medium Enterprises), Government of India as an autonomous national institute with an aim to undertake training, research and consultancy activities in small and micro enterprises focusing on entrep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prefix 'National' is put before the phrase 'Skill Development Programme' it becomes National Skill development Programme and it limits its scope and restricts it only to the activities/ efforts that are undertaken through Government funding, Government Schemes and specifically designed Government Programmes. We find that National Skill Development Programme would consist of the schemes, actions and deeds that are actually done or are mandated to be done by various ministries, Government departments or their attached offices, Directorates or other institutions as per their instructions and for which expenses in that regard are to be incurred by the Central or State Governments through budgetary provisions. The intent of the Notification No. 12/2017-CT as discussed above provides that exemption would be available only in respect of "Any services provided by a Training partner approved by National Skill Development Corporation in relation to the National Skill Development Programme implemented by the NSDC. Here it would be worth to mention that NSDC is a non-profit company set up by the Ministry of Finance and its mandate is to promote Skill development in various ways and it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous other ministries or departments, their attached or subordinate offices or institutions. If the services in relation to the schemes as mentioned in above paragraphs are provided through the partner approved by NSDC, then only the benefit of Notification as claimed would be applicable to the applicant and it would not be applicable in respect of other services relating to skill development provided by the applicant. In view of this we find that the National Skill Development Programme would cover only the actual schemes and programmes of skill development that are undertaken by the Government through its various ministries, departments, directorates, attached offices and organizations and cannot in any way be construed to be including each and every activity under the sun which enhances skills in one way or other. 06. In view of the deliberations as held hereinabove, we pass the order as under : ORDER (Under section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017) NO.GST-ARA-37/2017-18/B-44 Mumbai, dt. 05.06.2018 For reasons as discussed in the body of the order, the question is answered thus - Q.1. - "Whether ed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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