TMI Blog2019 (10) TMI 1187X X X X Extracts X X X X X X X X Extracts X X X X ..... e 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. Whether the 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 and consequently exempt under Notification No. 12/2017 read with section 8 (a) of GST? 2. Whether ITC is eligible for obligatory services provided to In-patients through outsourcing;- c. Washing and Sewage Removal - 100% d. House Keeping and Lease Rent on Machinery - On Proportionate basis. The applicant has submitted the copy of application in Form GST ARA - 01 and also submitted a copy of Challan evidencing payment of application fees of ₹ 5,000/- each under sub-rule (1) of Rule 104 of CGST rules 2017 and TNSGST Rules 2017. 2. 1 The applicant has stated that they are engaged in the health care service sector providing comprehensive patient care of International quality standards across all strata of the community with cutting edge technological equipment and by renowned medical specialists. They intend to create a sustainable health care system for the people of this region which shall be one of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and have strict restriction to ensure quality/quantity of items for consumption. Hence, the medicines or allied goods supplied to inpatients are indispensable items and are a composite supply to facilitate healthcare services and are not taxable. 2.4 All the obligatory services stated below are meant for the hospital and hence the ITC on such services are eligible inputs for the hospitals as follows:- a) Washing and Sewage Removal - 100% b) House Keeping and Lease Rent on Machinery - On Proportionate basis. They get tax invoices for the above services meant for hospital. These expenses are totally associated with Hospital Services and In-patient care. All the expenses indicated are GST suffered and hence the ITC for such obligatory services shall be given 100% for Washing and Sewage Removal and Proportionate basis for House Keeping and Lease Rent on Machinery, as the hospital discharges GST for the medicines supplied to out-patients and pays taxes for other items. Without this support, services, the Hospitals cannot be neat and clean in the interest of the patients visiting the hospital for various illness. 3.1 The applicant was heard on 18.06.2019. They furnish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supply Invoice No.58 dt.15-4-2019 for ₹ 26880/- for the purchase of goods. GST charged 10) Inward supply invoice No.050/2019-20 dt.31,5.2019 for ₹ 183357/- for Washing and cleaning - GST charged. 11) Inward Supply Invoice No.1920/May/WB/0041 dt.01-05-2019 for ₹ 1202906/- towards receipt of Leasing or rental service of machinery. 3.3 The applicant, further, vide their letter dated 20.06.2019 furnished a set of document consisting of In-patient Final Bill, Discharge summary, Nurse Requisition Note to IP pharmacy and copy of GSTR-3B for the Month of April 2019. They have further stated that the set of documents proves that the inpatient is under continuous monitoring of doctors and nursing staff and administration and dosage of medicines are all under control of the hospital doctors and claimed that the exemption under S.No. 74 of Notification No. 12/2017 dated 28.06.2017. 4. The jurisdictional Officers of both State and Centre have not furnished any comments on the questions raised by the applicant and on the facts stated by the applicant. 5. We have carefully examined the submissions of the applicant in their application, their oral and written ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ospital/polyclinic undertakes services of diagnosis, treatment which comprises of providing bed/ICU/room, nursing care, diagnostics including lab investigations and treatment surgical or otherwise under the directions of the Doctors. The hospital provides medicines, consumables, implants, etc. to the In-patients in the course of treatment on the directions of medical doctor for which the In-patient is billed together by the hospital. The hospital cannot provide health services including diagnostic, treatment surgery etc. without the help of medicines to be taken during treatment, implants and consumables used during their stay in the hospital. Only on using these medicines, consumable and implants as required and prescribed by the doctors and administered during their stay will the treatment be complete. Hence, supply of medicines, implants and consumables are natural bundled with the supply of health services. In this case, supply of health services is the principal supply as that is the reason the in-patients get admitted to hospital instead of buying the medicines or consumables and using on themselves. Therefore, supply of medicines, consumables and implants to in patients in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e health of a patient ii. gynaecological and obstetrical services delivered under the direction of medical doctors to inpatients, aimed at curing, restoring and/or maintaining the health of a patient iii. psychiatric services delivered under the direction of medical doctors to inpatients, aimed at curing, restoring and/or maintaining the health of a patient iv. other hospital services delivered under the direction of medical doctors to inpatients, aimed at curing, restoring and/or maintaining the health of a patient. These services comprise medical, pharmaceutical and paramedical services, rehabilitation services, nursing services and laboratory and technical services, including radiological and anaesthesiological services, etc. Thus, 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 un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he 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. 7.1 The next issue raised is on the eligibility of Input Tax credit of GST paid by the applicant on the inward services received by them. It is seen from the input services invoices for laundry services that they are for washing of bed sheets, pillow covers, gowns, pants shirts etc. meant for providing services to in patients. The applicant has not provided any input invoices for sewage removal. Hence, we cannot provide a ruling on the admissibility of input services for sewage removal. In res ..... X X X X Extracts X X X X X X X X Extracts X X X X
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