TMI Blog2020 (12) TMI 793X X X X Extracts X X X X X X X X Extracts X X X X ..... n to all educational institutions,. as defined in the notification(definition 2(y) of Notification No. 12/2017-CT(R)). Thus the entry at 66(b)(iv) seeks to exempt only those services provided to such institution in relation to admission of students or conduct of examination for such admission to all the educational Institutions, including the higher educational institutions, which were not exempted up to this amendment - As per the definition of affiliation under regulation 2.1 above, affiliation in relation to a college is an activity to recognize such college to the privileges of the university to which the institution is affiliated. In other words, the activity of affiliation is to monitor whether the institution possess the required infrastructure in terms of Space, Technical prowess, financial liquidity, faculty strength, etc and thereby eligible for the privileges to conduct the course/programme of study for the degree/title extended by the University to the students enrolled in such institutions. In the case at hand, it is evident that the affiliation services provided by the applicant enables the said institution to conduct the course/programme and do not relate to admis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. Initial affiliation fee to start an institution 7. Permanent Affiliation fee to the College 8. Continuation of affiliation fee for each course 9. increase in intake for each course for permanent basis, processing fee 10. Penal fee for receipt of late application are exempted vide sl.no 66 of Notification no.12/2017 CT(Rate) dated 28.06.2017. 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 SGST Rules 2017. 2.1 The applicant has stated to engage in activities to affiliate colleges to university as affiliated, professional or post graduate colleges under conditions prescribed and to withdraw affiliation from colleges, to approve colleges providing course of study for admission to the examinations for titles and diplomas of the University under conditions prescribed and to withdraw such approval, to designate any college as an autonomous college with the concurrence of the Government in the manner and under conditions prescribed and to cancel such designation. They have stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... distinctions on persons who- (a) shall have pursued an approved course of study in a University college or laboratory or in an affiliated or approved college, unless exempted therefrom in the manner prescribed by the statutes and shall have passed the prescribed examinations of the University; or to confer degrees, titles, diplomas and other academic distinctions of persons who shall have pursued an approved course or study in an autonomous college; to affiliate colleges to the University as affiliated, professional or post graduate colleges under conditions prescribed and to withdraw affiliation from colleges; to approve colleges providing course of study for admission to the examinations for tides and diplomas of the University under conditions prescribed and to withdraw such approval; to designate any college as an autonomous college with the concurrence of the Government in the manner and under conditions prescribed and to cancel such designation; The applicant has referred to Section 2 of the Bharathiar University Act 1981 (Tamilnadu Act 1 of 1982) and the relevant definitions mentioned therein viz, extracted below: (a) affiliated col ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 25.10.2018, wherein the annexure the clarifications have been given for affiliation fees viz extracted below: Annexure to Government Letter No. 11545/A2/2017-5 dated 25.10.2018 AFFILITATION FEES PAID BY COLLEGES S.NO. (1) Nature of Fees (2) Clarifications (3) 1 Application Form Fees This is service provided by an educational institution to public and not specific to its students only after admission the public becomes student of such educational institution. Hence this service would fall outside the definition of 'services provided by an educational institutions to its students faculty and staff. Therefore this is taxable under GST. 2 Application Fees (each course section) This is service provided by an educational institution to public and not specific to its students only after admission the public becomes student of such educational institution. Hence this service would fall outside the definition of services provided by an educational institutions to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the application to seek their willingness to participate in a virtual Personal Hearing in Digital media vide e-mail dated 09.07.2020. The applicant consented and the hearing was held on17.09.2020. The authorised representative participated in the hearing. He furnished a written submission through email which was taken on record and he reiterated the same. The representative stated that in pre-GST regime, demand on the said receipts under Service Tax was made which is settled under the SVLDRS scheme. He stated that the proceeding in Pre-GST regime is based on provisions of Chapter V of Finance Act 1994 and the Advance Ruling is sought under CGST/TNGST Act 2017. The representative emphasized that 'affiliation' is the Principal supply bundling the admission to conduct of examination and relied on Section 4 of the Bharathiar University Act, 1982. He claimed that the benefit of exemption at SI.No.66 (b)(iv) is available to them from 25.01.2018 after the words up to higher secondary was omitted from the said entry of Notification No.12/2017 vide Notification No. 02/2018 CT(rate) dated 25.01.2018. 3.2 The applicant vide their written submission during the Personal Hearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the education of the students from the affiliated colleges. For admission to University examination(Section 39), attendance under Section 40 is required and affiliation is in relation to admission and conduct of examination Entry Sl.No. 66(b) of Notification No. 12/2017-C.T.(Rate) dated 28.06.2017 as amended vide Notification No. 02/2018 dated 25.01.2018 is on the services provided to an educational institution by way of (iv) Services relating to admission to, or conduct of examination by, such institution and they are covered under the said entry. They are rendering services to the affiliated colleges relating to admission to, or conduct of examination by such institution (affiliated colleges). All the ten items covered in the application are in relation to affiliation and the affiliation is in relation to or conduct of examination and hence exempted as per the said entry. In the Letter No.11545/A2/2017 dated 25.10.2018 of the Higher Education Department, Chennai, correct interpretation of the wordings under Sl.No. 66 of Notfn No. 12/2017 as amended was not given properly. It has discussed the service by an educational institution to its students and not about to an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would not fall under the ambit of the exemption provided in the said Notification. Also, as per the wording of the Notification only the services relating to admission or to conduct examination, by such institution i.e only the services relating admission of students or conduct of examination is exempted and the other above services are chargeable to applicable GST. Hence, they have stated that the applicant is not eligible for the exemption provided under Sl.No.66 of the above notification. 5. The State jurisdictional authority has not furnished any comments and it is construed that there are no proceedings pending on the issue raised by the applicant. 6. We have carefully examined the statement of facts, supporting documents filed by the Applicant along with application, oral and written submissions made at the time of Virtual hearing and the comments of the Central Tax Authority. The applicant is a University established under the Bharathiyar University Act. They undertake activities related to affiliation of colleges as affiliated, professional or post graduate colleges under conditions prescribed and to withdraw affiliation from colleges; to approve colleges providing co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ject - to affiliate colleges to the University as affiliated, Professional or postgraduate colleges under conditions prescribed and to withdraw affiliation from colleges (Section 4(9) of the Bharathiar University Act); to approve colleges providing courses of study for admission to the examinations for titles and diplomas of the University under conditions prescribed and to withdraw such approval(Section 4(10) of the Bharathiar University Act); among other objects stipulated in the said Act. It is stated that they collect various fees from the Institutions who seek affiliation, Viz., 1. Application Form fees; 2. Application fees (Application * Registration fees(each course/Section)); 3. Inspection Fees (each course/Section); 4. Affiliation fee for each course; 5. Affiliation fee for each additional section; 6. Initial Affiliation fee to start an institution; 7. Permanent Affiliation fee to the College; 8. Continuation of affiliation fee for each course; 9. increase in intake for each course for permanent basis, processing fee; 10.Penal fee for receipt of late application. It is the contention of the applicant that affiliation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gone such programme of study for the examination for the award of such qualification: 2.4 Course means one of the units which comprise a programme, of study; 2.5, programme / programme of study* means a higher education programme pursued for a degree specified by the Commission under Section 22{3) of the UGC Act; 2.7, student means a person admitted to anti pursuing a specified programme of study. Thus, affiliation in relation to a college as defined under 2.2 of the regulation, is recognition of such college to be eligible for association with and admission of such college to the privileges extended by a University. Further regulation 3 gives the Eligibility Criteria for Temporary Affiliation'; regulation 4 gives 'Procedure for granting Temporary Affiliation', wherein under 4.5 it is stated that the University is to cause a preliminary scrutiny of the application and if found satisfactory should give a letter of intent and have to cause inspection for physical verification of the details in the application by a committee of experts constituted as per regulation 4.6 and thereon as per regulation 4.9, the Syndicate/Executive Council of the Uni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he institution, upgradation, increase in the capacity/course, etc and are governed by the UGC regulation discussed in Para 7.2 above. Therefore, we agree with the claim of the applicant that the entire gamut of activities for which the fees in questions are collected is a 'composite supply' with extending 'affiliation' to an institution of higher education being the 'Principal Supply'. 7.4 Having said so, the entry under which exemption is claimed is taken up for analysis. The entry at SI.No.66 of Notification No. 12/2017-C.T.(Rate) dated 28.06.2017 is as follows: 66 Heading 9992 or Heading 9963 Services provided - (a) by an educational institution to its students, faculty and staff; (b) to an educational institution, by way of,- (i) transportation of students, faculty and staff; (ii) catering, including any mid-day meals scheme sponsored by the Central Government, State Government or Union territory; (iii) security or cleaning or housekeeping services performed in such educational institution; (iv) services relating to admission to, or conduct of examin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess he is registered with the university through the college as per section 39/Section 40 of the Bharathiar University Act 1982. 7.5 In this regard, it is pertinent to examine the comments of the Fitment Committee as seen in the agenda notes placed before the 25th meeting of the GST Council and the minutes of the said meeting as the decision of the said meeting was effected vide Notification No. 2/2018-C.T.(Rate) dated 25.01.2018. Reference to the discussions and the decisions of the GST Council, a Constitutional Body, is to understand the intention of the amendment. The relevant recommendation of the Fitment Committee' accepted by the Council is given below for ease of reference: SI.No. Represented By Proposal Justification Comments of Fitment Committee 23 Reference from PMO based on feedback received on issues and problems faced in GST. To address taxability and GST exemption on admission fee charged by educational institutions and entrance fee charged for appearing in entrance examinations for getting admission into ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nation provided to all educational institutions, as defined in the notification and to also exempt services by educational institution (as defined above) by way of conduct of entrance examination against consideration in the form of entrance fee. From the above, it can be seen that the amendment was proposed to exempt services relating to admission to, or conduct of examination for admission to all educational institutions,. as defined in the notification(definition 2(y) of Notification No. 12/2017-CT(R)). Thus the entry at 66(b)(iv) seeks to exempt only those services provided to such institution in relation to admission of students or conduct of examination for such admission to all the educational Institutions, including the higher educational institutions, which were not exempted up to this amendment. 7.6 As per the definition of affiliation under regulation 2.1 above, affiliation in relation to a college is an activity to recognize such college to the privileges of the university to which the institution is affiliated. In other words, the activity of affiliation is to monitor whether the institution possess the required infrastructure in terms of Space, Te ..... X X X X Extracts X X X X X X X X Extracts X X X X
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