TMI Blog2022 (3) TMI 1144X X X X Extracts X X X X X X X X Extracts X X X X ..... served that in the clarification given at Point 5(2) of the aforesaid Circular No. 32/06/2018-GST, the issue being examined is in respect of retention money of ₹ 2,500/- out of total hospital charges of ₹ 10,000/- (out of which Consultant / Technician is paid ₹ 7,500/-). Thus, the major portion of the total hospital charges is towards payment to Consultant / Technician. Even the remaining minor portion of the hospital charges retained by the hospital is for providing ancillary services such as nursing care, infrastructure facilities, paramedic care, emergency services, checking of temperature, weight, blood pressure etc. - In the present case, the appellant does not fall under the definition of clinical establishment as already discussed and the major portion of the package offered by the appellant is towards accommodation. Therefore, this clarification is not applicable in the facts of the present case. Applicant is not eligible to get the benefit of Sr. No. 74 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 and corresponding Notification No. 12/2017-State Tax (Rate) dated 30.06.2017. - GUJ/GAAAR/APPEAL/2022/03 - - - Dated:- 17-2-2022 - M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o.74 of Notification No.12/2017Central Tax (Rate) dated 28.06.2017, the appellant is eligible for exemption. 4. The appellant sought ruling from the GAAR on the following question (i) Whether the applicant is eligible to get the benefit of entry No.74 of exemption Notification No.12/2017-Central Tax (Rate) dated 28.06.2017? 5. The GAAR examined the issue and observed that the package offered by the appellant, as evident from their website indicates that the therapy offered by them is strictly on a residence basis; that the total consideration mainly revolves around two factors viz. (i) the type of room and (ii) whether single or double occupancy; that the package of the appellant consists of the 3 components viz. (a) Accommodation, (b) Food; and (c) Therapy; that the packages would not be possible without any one of the 3 components. It has been observed that the packages offered by the appellant are naturally bundled and would be aptly covered under the definition of Composite Supply. Further, the principal supply would be the accommodation services since the therapy can in no way be administered without accommodation. In fact, there is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and a ward (room) will be allocated. (viii) Doctor prepares a Case Diary comprising all daily treatment plan, therapy and diet. (ix) Treatment proceeds as per case diary and doctor examine daily and advice patient accordingly. 8.3 The appellant has submitted that in pre-GST regime, the Deputy Commissioner, Central Excise, Kalol Division vide letter F.No. V/STDiv/Nimba/2014-15 dated 10.03.2015 had informed that the services provided by their company were exempt from service tax if they were providing in naturopathy 4 system of medicines. It has been submitted that on implementation of Goods and Services Tax (GST), the levy of GST by way health care services by a clinical establishment, an authorized medical practitioner or para-medics has been exempted by the Government vide Sr. No. 74 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. The appellant has referred to the definition of health care services provided under clause (zg) of the said Notification. 8.4 The appellant has further submitted that by virtue of entry no. 74A of Notification No. 12/2017-Central Tax (Rate) and CBIC Circular No. 32/06/2018GST dated 16.02.2018, entire charges, includin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s. Alcon Resort Holdings Pvt. Ltd. [2019-TIOL-209-AAR-GST] and has submitted that they are providing the same set of services to all the patients who obtain admission for their ailment and their ailment is cured by the qualified professionals / Doctors through the process of Naturopathy, Ayurveda and Yoga. 9.5 The appellant has submitted that the GAAR has relied on the contents available on the website and that too on the single page of the website. It has further been submitted their website clearly specifies on the home page that they are providing services related to Naturopathy and it is one of the largest Naturopathy centers in India. 9.6 It has been submitted that the main services of Nimba Nature Cure Village is to provide services related to health through Naturopathy and treatment of each ailment takes specified time for cure, but not less than seven days under the system of Naturopathy; that when a patient intends for treatment of Naturopathy, then in such case the patient has to stay at the Naturopathy centre for a time period as advised by the Doctor / qualified professional, which is in any case, not less than 7 days and has to follow the diet chart regiment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is eligible to get the benefit of Sr. No. 74 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 and corresponding Notification No. 12/2017-State Tax (Rate) dated 30.06.2017 (the Central Tax (Rate) Notification referred to includes the reference to corresponding State Tax (Rate) Notification also). 13.1 It would, therefore be appropriate to refer to the relevant entry at Sl. No. 74 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, which reads as follows :- SI.No. Chapter, Heading, Group Service Code (Tariff) Description of Services Rate (per cent) Condition (1) (2) (3) (4) (5) 74 Heading 9993 Services by way of- (a) health care services by a clinical establishment, an authorised medical practitioner or paramedics; (b) services provided by way of transportation of a patient in an ambulance, other than those specified in (a) above. Nil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted anything about these terms in the appeal filed before this authority. 14.2 The appellant had submitted before the GAAR that the Legislative Assembly of the State of Gujarat has not passed a resolution under Article 252 of the Constitution of India adopting the Clinical Establishment Act, 2010, therefore, it is not at all possible for them to get Registration under the Clinical Establishment Act, 2010. 14.3. It is under these circumstances that it would be beneficial to know how the aforesaid terms are understood in the common and industry parlance. 15.1 The Government of India, Ministry of Health Family Welfare (Department of AYUSH) vide NoR. 15016/5/2004-Y N dated 04.09.2006 addressed to the Secretaries (Health) of all States and Union Territories, on the subject of guidelines for the registration of Naturopathy practitioners and for the accreditation of Naturopathy institutions , inter-alia recommended the State Governments that a system be set up for the accreditation of institutions on the basis of the guidelines enclosed therewith. 15.2 In the said guidelines, Naturopathy Institutions has been defined to mean (i) Medical colleges conducting the Bachelor of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or care is provided . Hospital, on the other hand, is a health care facility with different bed capacities for indoor care and has ability to monitor and treat patients requiring an overnight stay, apart from providing care to outdoor patients. We have referred the aforesaid standards / guidelines to understand how the terms Hospital, Clinic etc. are understood in the common and industry parlance, not to see whether the appellant conforms to those standards / guidelines or otherwise. 15.8 The appellant has submitted that it functions as an integrated Health Care center and regimen demands that all the patients should be IP (In-Patient). It implies that the appellant does not provide health care to Out Patients and it does not have Out Patients Department. The appellant has also not submitted anything whereby it could be said that a clinical establishment could be only for Indoor Patients without having any facility for Outdoor Patients , more so when various standards / guidelines suggest that clinic / hospital must have adequate facilities for care of the Outdoor Patients. 16.1 The appellant has submitted that since healing under Naturopathy takes a longer duration of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant has submitted that it is engaged in providing all recognized alternative health care services such as Naturopathy, Ayurveda, Yoga and Meditation, Physiotherapy. It has also been submitted that the appellant also helps to heal the ailing people through alternative therapies from traditional Chinese Acupuncture Treatment, Reflexology and Acupressure Therapy etc. 18.2 As per the definition of clinical establishment , the institution offers services or facilities in any recognized system of medicines in India. The recognized system of medicines in India has been defined in clause (h) of section 2 of the Clinical Establishments (Registration and Regulation) Act, 2010 as follows- (h) recognised system of medicine means Allopathy, Yoga, Naturopathy, Ayurveda, Homoeopathy, Siddha and Unani System of medicines or any other system of medicine as may be recognised by the Central Government; 18.3 Thus, the health care services under Naturopathy, Ayurveda and Yoga being provided by the appellant are recognized system of medicine in India, whereas Physiotherapy, Acupuncture Treatment, Reflexology and Acupressure Therapy etc. cannot be said to be recognized system of medici ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exemption notification wherein the benefit of ambiguity must be strictly interpreted in favour of the Revenue/State. 42 to 47 48. The next authority, which needs to be referred is the case in Mangalore Chemicals (supra). As we have already made reference to the same earlier, repetition of the same is not necessary. From the above decisions, the following position of law would, therefore, clear. Exemptions from taxation have tendency to increase the burden on the other unexempted class of taxpayers. A person claiming exemption, therefore, has to establish that his case squarely falls within the exemption notification, and while doing so, a notification should be construed against the subject in case of ambiguity. 21.2 It has been clearly laid down in the aforesaid judgement that the exemption clause, at the threshold stage should be interpreted strictly and the burden of proving that the case of the appellant squarely falls within the exemption notification is on the appellant. However, as discussed herein above, the services being provided by the appellant does not appear to fall within the ambit of Sr. No. 74 of Notification No. 12/2017-Central Tax (Rate) and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... establishment, an authorised medical practitioner or paramedics are exempt. [Sl. No. 74 of notification No. 12/2017-C.T. (Rate), dated 28-6-2017 as amended refers]. (1) (2) Healthcare services have been defined to mean any service by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognised system of medicines in India [para 2(zg) of notification No. 12/2017-C.T. (Rate)]. Therefore, hospitals also provide healthcare services. The entire amount charged by them from the patients including the retention money and the fee/payments made to the doctors etc., is towards the healthcare services provided by the hospitals to the patients and is exempt. (3) Food supplied to the inpatients as advised by the doctor/nutritionists is a part of composite supply of healthcare and not separately taxable. Other supplies of food by a hospital to patients (not admitted) or their attendants or visitors are taxable. 22.3 It is observed that in the clarification given at Point 5(2) of the aforesaid Circular No. 32/06/2018-GST, the issue being examined is in respect of retention money of ₹ 2,500/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on No. 25/2012-Service, the definition of recognised system of medicines defined under Section 2(h) of the Clinical Establishments Act, 2010 and concluded as follows Hence, it appears that any Health care services when provided by way of diagnosis or treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognized systems of medicines provided in any institutions only are exempted from payment of service tax under the Mega Exemption Notification No. 25/2012-ST dated 20.06.2012 (Sl. No. 2) and healthcare services other than those above do not fall under the purview of the said exemption. It is therefore, requested to kindly examine your Service Tax liability in the light of the above clarifications and if your services conform to the above, it is exempted under the said notification, if not, then comply with the provisions of the Finance Act, 1994 and the rules made there under. 23.3 Further, the text of the letter dated 10.03.2015 of the Deputy Commissioner, Central Excise, Kalol Division is as follows Kindly refer to your letter dated 06.02.2015 (received in this office on 12.02.2015) on the above-mentioned subject. In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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