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TMI Blog2020 (7) TMI 348X X X X Extracts X X X X X X X X Extracts X X X X ..... purposes of this Advance Ruling, a reference to such a similar provision under the CGST or AP GST Act would be mentioned as being under the GST Act. 3. BRIEF FACTS OF THE CASE: 3.1 The applicant herein is a proprietary firm and a leading educational institution providing coaching to students for Chartered Accountancy certificate ('CA'); Cost and Works Accountancy Certificate ('ICWA') and Intermediate Certificate. The coaching provided by the applicant enables the students to appear for the examinations conducted by the respective statutory bodies i.e., Intermediate (Higher Secondary Education), Chartered Accountancy Course (consisting of three levels i.e. CA Foundation Course (earlier referred as 'CPT), CA-Intermediate (earlier referred as TPCC') Course and CA-Final Course), and Cost Management Accountancy (Consisting of three levels i.e. CMA Foundation Course, CMA-Intermediate Course and CMA-Final Course) and to obtain the necessary qualifications. The applicant's registration with Service tax department was migrated to GST under GST Act w.e.f. 01.07.2017. However, on the request of the applicant on the ground that the educational services provided by the applicant were exempte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ictional Assistant Commissioner and the department had Not filed any appeal against such refund order. 3.5. The latest show cause Notice was issued to the applicant for the period from 1.4.2012 to 30.6.2017 demanding service tax on the coaching provided by the applicant for the courses of CA and ICWA but the demand was dropped by the Commissioner of Central Tax, Guntur both on merits and limitation. 3.6. With the introduction of the GST, the applicant desires to kNow whether the same exemption provided under the Finance Act, 1994 is applicable to him under the GST Law also since identical exemption was provided under both the Laws. He accordingly filed the present application. 4. APPLICANT'S INTERPRETATION OF LAW AND FACTS: 4.1. Intention of the Government was always to keep the services provided in relation to education and medical services out of the ambit of service tax as they are related to public welfare. 4.2. Under the service tax regime introduced since 1994, commercial coaching or training was made a taxable service. However, Notification NO.33/2011-ST dt.25.4.2011 provided exemption to a commercial institute providing any coaching that lead to any certificate recogni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Central Government, State Government or Union territory; (iii) Security or cleaning or house-keeping services performed in such educational institution; (iv) Services relating to admission to, or conduct of examination by, such institution; upto higher secondary: Provided that Nothing contained in entry (b) shall apply to an educational institution other than an institution providing services by way of pre-school education and education up to higher secondary school or equivalent." 4.7. The term 'educational institution' is also defined under the GST Act in Notification No. 12/2017- Central Tax (Rate), dated 28.06.2017 as follows: "educational institution" means an institution providing services by way of- (i) pre-school education and education up to higher secondary school or equivalent; (ii) education as a part of a curriculum for obtaining a qualification recognized by any law for the time being in force; (iii) education as a part of an approved vocational education course; 4.8. It is clear from the above that the definition of the term 'educational institution' under the Finance Act, 1994 and GST Act, 2017 are one and the same. Therefore, prior to introduct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... can be understood as 'imparting kNowledge (education) through a systematic syllabus in an institution/ college/ school". The education shall be useful for obtaining a 'qualification' recognized by law to get exemption under the provisions of Section 66D(1)(ii) of the Act and subsequent to April 2016 under the exemption Notification and under GST from 1.7.2017. What is to be seen here is whether, the applicant is an institution, and whether the coaching or training that the applicant imparts / prepares the students for obtaining a qualification duly recognized by any law. It is a settled legal position that the legal provisions are to be read literally and No words shall be added or deleted from the provision. The applicant cites few decisions in this regard below: (a) In the case of Ranbaxy vs. UOI 2012 (27) STR 193 (SC) = 2011 (10) TMI 16 - SUPREME COURT, the Hon'ble Supreme Court held as follows: "10. It is a well settled proposition of law that a fiscal legislation has to be construed strictly and one has to look merely at what is said in the relevant provision; there is Nothing to be read in; Nothing to be implied and there is No room for any intendment. [See: Cape Brandy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) TMI 63 - SUPREME COURT. 4.13. Therefore, the applicant satisfied the first limb of the definition of the term 'educational institution' to avail the exemption, the institution shall provide 'education' as part of its coaching provided to the students and therefore, he is eligible for the exemption. 4.14. As regards to the issue whether the education is imparted as part of a curriculum prescribed by any statutory body or institution, the applicants submits that he imparts the education as part of curriculum. The coaching provided by him for the courses is as per the curriculum prescribed by the respective statutory bodies as detailed below: (a) Systematic coaching is provided to the students for obtaining the qualification/ certificate of 'Intermediate Course' as per the curriculum prescribed by Board of Intermediate Education of Government of Andhra Pradesh and Telangana or other state governments. Copy of GO issued in this regard and the syllabus prescribed is filed herewith. (b) Systematic coaching is provided to the students by the applicant as per the curriculum prescribed by ICAI for obtaining the qualification of Chartered Accountancy Course. Copy of Prospectus for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as implemented the new scheme of education (new' syllabus) for Chartered Accountancy Course, which consists of three levels i.e. (a) Foundation Course (Level One) (b) Intermediate Course (Level Two) (c) Final Course (Level Three) (f) The ICMAI Institute designs the curriculum of syllabus for the three level of CMA course and provides study material to the enrolled students. After qualifying in the examinations conducted by the institute and successful completion of each level of CMA Course, the institute will issue Marks Memos and Certificates to the students as is done, for a degree course, by any University. Copy of Prospectus for CMA course taken from the website of ICAI is filed herewith. Admission to Foundation and Intermediate Course of CMA is as par with CA course. Further, foundation Course of CA/ CMA is Not an admission examination, but it is a Part of CA / CMA Course and only students who qualified in a specified degree courses are eligible for direct entry into Intermediate Course of CA/CMA. 4.15. Therefore, he satisfied the second limb of the definition of the term 'educational institution' to avail the exemption, the institution shall provide 'education' as pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for Non-commerce degree, issued by recognized university. Hence, it is very much clear that Foundation Course is a qualification recognized under law and issued by the Institute which established under an Act of Parliament. Further, the student who wishes to study CA/CMA courses shall have to register with respective Institute, which is valid for three years and he has to pass the Foundation Course. If he fails to pass through the above within three years, he has to register again for completion of Foundation Course. The enrolment number given at the time of registration will remain as his ID No for entire duration of the completion of CA/CMA Course. 4.19. The ICAI issues a Marks Memorandum under Chartered Accountants Act, 1949 read with Regulation 250(3) of the Chartered Accountants Regulations, 1988 when a candidate passes the CPT/Foundation examination. The Marks Memorandum issued under statutory authority and it is showing as issued for passing the exam and as a qualification to go to next stage. The certificate for CA completion is issued under Regulation 25E of the said Regulations. The confusion appears to be due to Not understanding the replacement of the term 'certificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and Competency Level Part II Examination of CAT of the Institute/ Passed Foundation of ICSI/Intermediate of ICAI is eligible to apply to ICMAI for CMA Inter. It is an intermediate stage to cross for obtaining the qualification/ certificate of CMA and is a continuing education for the students. A Student who passed the Foundation exam will be awarded with a Marks Memorandum issued by the Institute showing obtaining of qualification of Foundation Course. 4.23. In respect of the Intermediate Course, it is the second stage in completion of CMA course after the completion of CMA-Foundation]. Intermediate Course consists of two groups i.e., Group-i and Group-2 with a duration of 8 months i.e., a student has to wait for a minimum of 8 months to write the CMA Inter exam after registering for CMA-Inter with ICWAI. Student will be issued a certificate from ICWAI when he/she passes the CMA-Inter examination. The certificate issued under statutory authority for passing the exam and as a qualification to go to next stage i.e. Final Course and Practical Training. It is an intermediate stage to cross for obtaining the qualification/ certificate of CMA and is a continuing education for the st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned above, it is a settled legal position that words in a Notification or statute shall be read as they are and No word shall be added or deleted for reading the statute. In the case of Gujarat Vs Reliance Petroleum Ltd 2008 (227) ELT 3 (SC) = 2008 (5) TMI 13 - SUPREME COURT, the Hon'ble Apex Court has held that an exemption Notification should be read literally and to be construed liberally. As held by the Hon'ble Supreme Court in the case of Commissioner of Customs (Prev), Amritsar vs. Malwa Industries Ltd 2009 (235) ELT 214 (SC) = 2009 (2) TMI 41 - SUPREME COURT, exemption Notification canNot be unduly stretched to produce unintended results in derogation of the plain language employed therein. Thus, when the words employed in the legislature are simple, plain and unambiguous there is No reason to qualify or restrict by addition or deletion of any other words. 4.30. The essential condition, as seen from the definition of the term 'educational institution', is that, providing service as education as a part of a curriculum for obtaining a qualification recognized by any law for the time being in force. This has been satisfied by the applicant as detailed above. The coaching provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rately exempted vide Notification No. 12/2017-Central Tax (Rate) dt.28.06.2017 (SI.No.14). Sample copies of receipts issued by the applicant to the students for charging fee for accommodation are filed herewith. The amounts charged as about Rs. 2,500/- per course spanning for a period of 10 months and therefore, the daily fee works out to less than the threshold limit provided under the said Notification and accordingly, he is Not required to pay any GST on the said charges. 4.33. In view of the above, he opines that: (a) The applicant falls within the definition of the term 'educational institution' as per the Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, as amended till Now. (b) The services provided by him are related to provision of education. (c) The education is provided as a part of a curriculum and (d) The service is provided by him to his students for obtaining qualifications duly recognized under any Law for the time being in force and (e) He is eligible to claim the exemption from payment of GST on the coaching service provided to his students for the above courses and also for provision of accommodation and catering. 5. QUESTIONS RAISED IN TH ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of service of education' as per the curriculum prescribed by the statutory authorities/ government to the students of the applicant for obtaining qualifications/ certificates of CA-Foundation, CA-Inter, CA-Final, CMA (ICWA)-Foundation, CMA-Inter, CMA-Final and Intermediate duly recognized by the respective statutory authorities/ government are exempted under Notification No.12/2017-CT (Rate) dt.28.06.2017 (entry No.66(a)), as amended? (b) Whether the charges collected for providing accommodation to the students undergoing the above courses are exempted from GST as provided under Notification NO.12/2017-CT (Rate) dt.28.06.2017 (entry No.14), as amended read with Circular NO.32/06/2018-GST dt. 12.2.2018 since the amount charged from the students by the hostel run by the applicant is less than Rs. 1000/- per day? (c) Whether the charges collected by the applicant for catering service by supplying food to the students undergoing the above courses are exempted from GST as provided under Notification NO.12/2017-CT (Rate) dt.28.06.2017 (entry No.66(a)), as amended? 6. On Verification of basic information of the applicant, it is observed that the applicant is an unregistered dealer lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n entry' No.66 as applicable from 1.7.2017 are reproduced below again: Services provided - (a) By an educational institution to its students, faculty and staff; The term 'educational institution' as per the said Notification is as under: "educational institution" means an institution providing services by way of- (i) pre-school education and education up to higher secondary school or equivalent; (ii) education as a part of a curriculum for obtaining a qualification recognized by any law for the time being in force; (iii) education as a part of an approved vocational education course; 8.4. The relevant entry prior to 1.7.2017 under the service tax regime under Notification No.25/2012-ST (entry No.9) is as follows: (9) Services provided, - (a) by an educational institution to its students, faculty and staff; (b) ................ The said Notification No.25/2012-ST defined an 'educational institution' as follows: "2(oa): Educational institution means an institution providing service by way of: (i) Pre-school education and education up to higher secondary school or equivalent. (ii) Education as a part of curriculum for obtaining qualification of any law time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under exemption Notification No.25/2012-ST dt.26.10.2012 thereafter. (c) The allegation that the applicant is providing only part of curriculum/ syllabus but Not providing training or coaching for all the syllabus prescribed by the statutory bodies is Not acceptable as providing part of syllabus prescribed will Not alter or influence the status of the services provided as long as they are provided in relation to education for obtaining qualification. (d) There are No legal requirements for the institute as per the entries in the negative list and the exemption Notification for the institute to be recognized or authorized but only a condition that the education imparted should be part of curriculum for obtaining a qualification recognized by any law. 8.7. We have examined the issues raised in the application. The taxability and the applicable rate of tax for the goods and services supplied or to be supplied, as governed under the provisions of respective GST Acts are examined. In view of the submission made by the applicant we find that the basic issue before us is whether the services of supply of service of education as per the curriculum prescribed by the statutory authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2018, extracted below specifies the following education services as exempted from GST. "Services provided - (c) By. an educational institution to its students, faculty and staff. (d) To an educational institution, by way of, - (v) Transportation of students, faculty and staff; (vi) Catering, including any mid-day meals scheme sponsored by the Central Government, State Government or Union territory; (vii) Security or cleaning or house-keeping services performed in such educational institution; (viii) Services relating to admission to, or conduct of examination by, such institution; up to higher secondary: Provided that Nothing contained in entry (b) shall apply to an educational institution other than an institution providing services by way of pre-school education and education up to higher secondary school or equivalent." V. The term 'educational institution' is also defined under the GST Act in Notification No. 12/2017- Central Tax (Rate), dated 28.06.2017 as follows: "educational institution" means an institution providing services by way of- (i) pre-school education and education up to higher secondary school or equivalent; (ii) education as a part of a c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erned statutory body in the chain of awarding of certification. The student is at liberty to discontinue coaching from the applicant's coaching centre (at the cost of financial loss, but Not at the cost of academic loss) and continue his study on his own or from such other coaching centre in the course of pursuance of being conferred with Inter or Final Certificate by the above said statutory bodies. Therefore, the service provided by the applicant to the aspirants of CA (Inter & Final) and ICWA (Inter & Final) does Not ensure that the student obtains a qualification recognized by any law and hence the same does Not fall under clause (ii) of the definition given to 'Educational Institution'. VII. The above definition and the entries in the Notification thus, brought educational services out of the purview of service tax/GST, if provided by an educational institution and if, (a) The service provided is related to education. (b) The education is provided as a part of a curriculum and (c) The education is provided for obtaining a qualification recognized by any law for the time being in force. VIII. In the instant case, the coaching or training provided by the applicant is f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rant of certificate/qualification recognized by law. Therefore, the service rendered by the applicant is Not a service by way of 'education as a part of curriculum for obtaining a qualification recognized by any law for the time being in force'. XII. With regards to the supply of food and accommodation to the students of the applicant, Entry No.66 of Notification No.i2/20i7-Central Tax (Rate) dt.28.06.2017 as amended by Notification No.2/2018-Central Tax (Rate) dated 25.01.2018, extracted below specifies the following education services as exempted from GST. "Services provided - (e) By an educational institution to its students, faculty and staff; (f) To an educational institution, by way of, - (ix) Transportation of students, faculty and staff; (x) Catering, including any mid-day meals scheme sponsored by the Central Government, State Government or Union territory; (xi) Security or cleaning or house-keeping services performed in such educational institution; (xii) Services relating to admission to, or conduct of examination by, such institution; up to higher secondary: Provided that Nothing contained in entry (b) shall apply to an educational institution other tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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