TMI Blog2021 (2) TMI 195X X X X Extracts X X X X X X X X Extracts X X X X ..... d for the benefit of the poor people in India. If the study shows the care bundle intervention is effective, then it would form the basis for Health Policy in India. Compensation, invoicing and payment - HELD THAT:- It is seen in the agreement that the sponsor shall compensate only for the completed patient visits, laboratory and other investigations, pharmacy costs and other comparable costs as defined by the protocol and approved by the sponsor. Any other expenses shall not be compensated for without a separate written agreement concluded with the sponsor thereof. The sponsor shall compensate for any extra travelling costs attributable to the trial subject using public transportation and caused by his/her participation in the trial. In order to ensure the privacy of the subjects, the institution (i.e. applicant) takes care of the payments of compensations to the subjects and charges the sponsor these costs. The sponsor shall bear the costs of all necessary training, meetings, other travelling and events related to the trial - All payments relating to the trial, including compensation paid to the investigators and other research personnel shall be directed to the account indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, as explained earlier is not in connection with the diagnosis or treatment or care for illness and is related to support services for research and is covered under SAC 998599 and hence is not covered under healthcare services and thereby not covered under entry no. 74 of Notification No.12/2017- Central Tax (Rate) dated 28.06.2017. Whether the transaction is an export of service? - HELD THAT:- In the present case, the applicant is the supplier of service 86 is located in India and the recipient of service, i.e. the Imperial College of London, is located outside India. The payment for such service is received in convertible foreign currency and the supplier and recipient are not related persons. Hence the determination of whether the service provided by the applicant to the Imperial College London is an export of service or not is wholly dependent on the place of supply. Whether the applicant is an intermediary or not? - HELD THAT:- The applicant is involved in the arranging and facilitation of the supply of research services by the principal investigator to the Imperial College London and he is not covered under the exclusion clause as he is not supplying such researc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liable to pay tax on outward services, if yes, at what rate? e. Whether the applicant is required to be registered under the Act? 3. Admissibility of the application: The application is in relation to the classification of goods and rate of tax applicable to the supplies made, the eligibility of input tax credit and also on the liability to register under the GST Act and the same is verified and found admissible and hence admitted. 4. The applicant furnishes some facts relevant to the issue: 4.1 M/s Vevaan Ventures is a Partnership Firm having its registered office in Bengaluru. The firm has not obtained registration under the GST Acts. The principal object of the firm as amended by supplementary deed dated 05.05.2020 is to carry out clinical research activities in India to determine the safety and effectiveness (efficacy) of medications, devices, diagnostic products and treatment regimens intended for human use. 4.2 Imperial College, London, a foreign institution, wanting to carry out a major multi-centre study in India to reduce brain injury and epilepsy in babies - The PREVENT (Prevention of Epilepsy by Reducing Neonatal Encephalopathy) has identified the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... findings of research study and shall raise periodic invoices towards the conduct of research study as agreed between the parties vide Clinical Trial Agreement and the same shall be made good in accordance with terms of the said agreement. 4.4.4 Regarding the role of Imperial College London, the applicant states that Imperial College London (legally Imperial College of Science, Technology and Medicine) is a public research university located in London. Imperial College was established in 1907 in London's scientific and cultural heartland in South Kensington, as a merger of the Royal College of Science, the City and Guilds College and the Royal School of Mines. Imperial College London consistently achieves one of the highest rankings nationally and internationally, as listed in the Times Higher QS World University Rankings in the top 10 Universities in the world. It is a registered charity in the UK. The Imperial College embodies and delivers world class scholarship, education and research in science, engineering and medicine, with particular regard to their application in industry, commerce and healthcare. It foster interdisciplinary working internally and collaborate widel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne if Epilepsy caused by brain related injury occurring at the time of childbirth can be prevented. Accordingly, the research study aims to diagnose certain abnormalities caused during childbirth and thus the services provided by the entity squarely fall under the purview of the term health care services as defined supra. VIRTUAL HEARING: / PROCEEDINGS HELD ON 08-10-2020 6. Sri Sukruth N Segu and Sri Ashray Hosakote Chartered Accountants and Duly Authorized Representatives alongwith the applicant appeared for virtual hearing proceedings on 8th October 2020 before this authority and they reiterated the contentions made in the application and also explained the process in detail. FINDINGS DISCUSSION 7. At the outset we would like to make it clear that the provisions of CGST, Act 2017 and SGST, Act 2017 are in pari-materia and have the same provisions in like matter and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a reference to the CGST Act would also mean reference to the corresponding similar provisions in the KGST Act. 8. We have considered the submissions made b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the basis for Health Policy in India. 12. Regarding the role of the applicant, the applicant is infact doing the entire research in India, i.e. identifying the hospitals that are to be the research sites, on-boarding of the research staff, namely Doctors, Nurses and other support staff to use the intervention methods. The applicant is undertaking the activities for updation of the knowledge of the medical staff by conducting conclaves, meetings, symposiums, gatherings amongst others. Later on the applicant would provide the tablets and devices which are used in the research studies to the trained personnel and collect the data. 13. The applicant would be purchasing necessary equipments used in the research and do such other activities for carrying out the research. This includes purchase of Dopplers, scanning devices, printers, hand-held tablets, computers, consumables required for day to day operations like PPE Kits, Gloves etc. and also services like collection of samples from patients, getting it processed at laboratories for results, and also engaging the services of various agencies, who are specialised in storage of medical samples and data, to store the samples over a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... igator is at the Sponsor and the project shall be performed by and under the direction and supervision of the Chief Investigator 16.1 As per the agreement, the scope of work for the applicant is as under: a) Enter into agreements/ contracts with the trial sites identified by the sponsor for enabling the conduct of research study Provide medical and co-investigators. b) equipment and other related apparatus to enable the conduct of the research c) Engage a team of research staff for managing and assisting principal investigator in all aspects of the study related research work, including EEG and MRI of the recruited infants d) Ensure that the trial shall be conducted under safe conditions e) Undertake follow up assessments of the babies recruited to the study f) Monitor the research activity and provide summary report to the sponsor at frequent intervals g) Enter into contracts and agreements for the conduct of research h) Allow participation of the investigators and when appropriate/ needed also trial nurses in Investigator Meetings and other education arranged by the Sponsor i) Ensure that the investigators are familiar with the detai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vents, which according to the protocol or any other document, such as Investigator's Brochure, do not require immediate reporting, and also to follow the protocol with respect to the reporting of adverse events f) Ensure accuracy, completeness, reliability, and timeliness of the information submitted to the sponsor on the case report forms and all required reports, including those in electronic format, and deliver the case report forms and other required reports to the sponsor. g) Take care of the registration and notification of information necessary for the invoicing to the financial administration of the institution at agreed intervals; and h) Act in co-operation with the sponsor and the institution relating to monitoring visits and audits i) Ensure that all subjects have given proper written informed consent to their participation in the trial and have received sufficient information of the trial and benefits, risks, and disadvantages related thereto for giving the consent. 16.4 Regarding the compensation, invoicing and payment, it is seen in the agreement that the sponsor shall compensate only for the completed patient visits, laboratory and other i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the research. It is a support activity and the principal investigators conducting the research are the actual persons doing research and providing the data to the sponsor. 17. The sample consultant agreement submitted by the applicant is examined and found that the consultant hired are rendering services to the applicant and the manner in which the consultant chooses to complete the services is in the sole discretion and control of the consultant. The consultant's obligations shall be conditioned upon receiving such information and co-operation from the applicant as may be reasonably necessary to perform the services. It is also made clear that the agreement would not constitute an employer-employee relationship and it would be the intent of the applicant and the consultant that the consultant at all times be an independent contractor. It is also made clear that the applicant would be liable to pay the consideration of the contract. The scopes of work of the consultants hired are as under: 17.1 Scope of work relating to research: (a) takes an active lead in the setting up, co-ordination and management of the project (b) to identify and help recruit pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty would be covered under health care services is examined and found that the term health care services is defined in Notification No.09/2017 - Integrated Tax (Rate) dated 28.06.2017 in clause (zg) of para 2 and the same reads as under: (zg) health care services means any services by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicines in India and includes services by way of transportation of the patient to and from a clinical establishment, but does not include hair transplant or cosmetic or plastic surgery, except when undertaken to restore or to reconstruct anatomy or functions of body affected due to congenital defects, developmental abnormalities, injury or trauma: The services provided by the applicant, as explained earlier is not in connection with the diagnosis or treatment or care for illness and is related to support services for research and is covered under SAC 998599 and hence is not covered under healthcare services and thereby not covered under entry no. 74 of Notification No.12/2017- Central Tax (Rate) dated 28.06.2017. 19. On the issue, whether the transaction is an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the Imperial College London would not be an export of services under section 2(6) of the IGST Act, 2017. 20. The activity of the applicant is squarely covered under the entry no.23(ii) of Notification No.11/2017- Central Tax (Rate) dated 28.06.2017 and is liable to tax at 9% CGST and similarly liable to tax at 9% KGST, in case the transaction is a intra-State supply. Since the services provided by the applicant is not exempt, the applicant is eligible to claim and avail input tax credit in terms of section 16 of the CGST Act, 2017 and section 16 of the KGST Act, 2017. 21. Since the applicant is involved in intra-State supply of services, as the location of the supplier and the place of supply is the same state, the applicant is liable to register as per the terms of section 22 of the CGST Act, 2017. 22. In view of the foregoing, we rule as follows RULING 1. The activities undertaken by the applicant is covered under SAC 998599. 2. The exemption given under Notification No.9/2017- Integrated Tax (Rate) dated 28.06.2017 is not applicable to the transactions of the applicant. 3. The applicant can avail the input tax credit of tax paid on his inward suppli ..... X X X X Extracts X X X X X X X X Extracts X X X X
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