TMI Blog2022 (10) TMI 774X X X X Extracts X X X X X X X X Extracts X X X X ..... 2333F1ZV), is being referred to the Appellate Authority for Advance Ruling for the state of Telangana in terms of Section 98(5) of the CGST/TGST Act, 2017 for hearing. - A.R.Com/18/2021, TSAAR Order No. 49/2022 - - - Dated:- 14-7-2022 - SRI B. RAGHU KIRAN, IRS, AND SRI S.V. KASI VISWESWARA RAO, MEMBER Sub: Referring application to Appellate Authority for Advance Ruling in terms of Section 98(5) of TGST Act, 2017 for hearing and decision Reg. ********** M/s. Magnetic Infotech Pvt Ltd, Plot NO.08, Krishna Nagar Colony, Kakaguda Village, Wellington Road, Picket, Secunderabad, Hyderabad, Telangana- 500009 (36AACCM2333F1ZV) has filed an application in FORM GST ARA-01 under Section 97(1) of TGST Act, 2017 read with Rule 104 of CGST/TGST Rules, seeking Advance Ruling on the following as under : a. Whether GST exemption is applicable to applicant in respect of the pre and post Examination services being provided to the Educational Boards and Universities (including Open Universities)? b. If answer to Q.No.1 is affirmative, whether the exemption is available to the applicant in case of the services are provided on sub-contract basis i.e., the applicant provides pre an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the examination results by applying all the rules and generating the result sheet, tabulation of result and declaration of result, then issuing the marks memos to the students. The same procedure is followed for the supplementary exams to be conducted for the failed candidates. Scope of work for State Education Boards: 6. The scope of services from the contract entered with Director of Government Examinations (DGE), Nampally, Hyderabad, Telangana is mentioned below. Scope of work: The entire project work can be broadly divided into two parts. i. Pre-examination work ii. Post-examination work Pre-examination and Post examination work is required to be carried out in the premises of DGE, Telangana in the room allocated for the purpose. The applicant cannot sub-let any part / item of work to other agencies as the work is very sensitive, time bound and most confidential in nature. Relevant clauses enumerating the scope of service to be provided by the applicant are extracted herein below: Data Processing: The data processing consists of data entry and other activities. The applicant should arrange sufficient required equipment for scanning of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lity CDs V. Pass certificates: The service provider has to supply the data structure of the passed candidates in the prescribed format on CDs in order to print SSCs with variable data with images (photos). vi. Pass memos on printed stationery 7. The applicant has to establish the processing unit at designated location, deploy the required manpower, arrange required stationery as per the specifications of DGE, printing supply of OMR Sheets, Attendance Sheets, submission of various reports, etc. Scope of work for Universities: 8. The Scope of work from the contract entered between the applicant and the Controller of Examinations, Osmania University, Hyderabad, Telangana is mentioned below. The scope of work for Digitization of answer scripts and onscreen evaluation: a) Scanning of answer scripts b) Uploading of the scanned answer scripts data into server. c) On-screen evaluation of answer scripts d) Providing of marks data for result processing Responsibilities of University: i) The University shall provide necessary accommodation, infrastructure, stabilized electric power, power backup, Air conditioning, furniture and oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall make arrangement to export the evaluation data in encrypted format to the central server for further process and also data shall be given in the electronic media to the Director of Evaluation of the University Scope of work for Open Universities: Scope of work for open Universities 9. The applicant has also entered into contracts with open Universities for providing pre and post examination services. The scope of work under the contract entered with the Registrar, Yeshwantrao Chavan Maharashtra Open University, Nashik, Maharashtra is mentioned below. Scope of Examination Management System: The applicant shall provide a) Pre-Examination services covering exam scheduling, hall ticket generation, generation of attendance sheets, summary, daily report, Jr. Supervisor report and collected fee management, etc. b) Customized software for question bank development as per blue print of YCMOU time to time and training to the item writers and all concern, QP generation, uploading QP. c) Digital valuation services include pre-CAP, scanning of AB, making available for evaluation, identifying CAP centres as per need throughout Maharashtra State, with nec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Advance Ruling Authority in terms of Section 97(2)b) of the CGST Act. Hence, present advance ruling application is maintainable before the Hon'ble Authority for Advance Ruling, Telangana. ISSUES REQUIRING ADVANCE RULING: 14. The applicant submits the following questions for Advance Ruling and their interpretation on the questions as under: a. Whether GST exemption is available to the applicant in respect of the pre and post Examination services being provided to the Educational Boards and Universities (including Open Universities)? b. If answer to Q. No.1 is affirmative, whether the exemption is available to the applicant in case the services are provided on sub-contract basis i.e. the applicant provides pre and post examination services to the main contractor who in turn provide the said services to the Educational Boards Universities (including Open Universities)? Applicant's understanding: 15. The applicant believes that the supply of pre and post examination services to educational institutions like Educational Boards, Universities (including open Universities) are in relation to admission to, or conduct of examination by the said institut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... For the purposes of this notification, (iv) For removal of doubts, it is clarified that the Central and State Educational Boards shall be treated as Educational Institution for the limited purpose of providing services by way of conduct of examination to the students. 19. The definition of 'educational institution' as provided under NN-12/2017 is reproduced below. 2(y) educational institution means an institution providing services by way of, (i) pre-sc pre-school education and education up to higher secondary school or equivalent; (ii) education as a part of a curriculum for obtaining a qualification recognised by any law for the time being in force; (iii) education as a part of an approved vocational education course, 20. Thus, from the above definition, it is understood that any institution which provides education for obtaining a qualification recognized by any law is treated as an educational institution. Further, any service provided relating to admission to, or conduct of examination by, such institution is eligible for exemption. 21. In the present case, the applicant has entered into agreements with State Education Boards and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the directions/guidelines of the Universities. 27. The colleges do not prepare curriculum, do not conduct examinations and do not grant certificates to the students. The Universities maintain all the details relating to a student, conduct examinations and grant certificates to the students. 28. Thus, it is submitted that the Universities are imparting education by formulation of courses, prescription of syllabus, academic schedule preparation, conducting examinations, evaluation and award of degrees/qualifications recognized by law. 29. In case of Open Universities, there are no colleges affiliated to the said universities. The open universities directly impart education to students through contact classes. The course material and books are directly supplied by the Open Universities to the students. The degrees or diplomas are also granted by the Open Universities. The Open Universities are also established by law and the qualifications awarded by them are recognized by law. 30. The applicant submits that in case of State Education Boards and Universities, the education boards/universities conduct the examinations and grant certificates/degrees to the students and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be given a narrow meaning by restricting it to the actual imparting of education to the students but has to be given a wider meaning which would take within its sweep, all matters relating to imparting and controlling education. Examination is an essential component of education as it is one of the major means to assess and evaluate the candidate's skills and knowledge, be it a: school test, university examination, professional entrance examination or any other examination. As held by the Supreme Court, the examination is considered as a common tool around which the entire education system revolves. Thus, education would mean the entire process of learning, including examination and grant certificate or degree or diploma, as the case may be and would not be limited to the actual imparting of education in schools, colleges or institutions only. Unless the School Boards hold examinations, the education of school students would not be complete, so is the case with college students, whose education would be complete only when the University conducts examinations and awards degrees or diplomas. It is the School Boards which issue the Secondary and Higher Secondary School Ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and Central Education Boards would qualify as educational institutions for the purpose of exemption from GST as per Sl. No. 66(b)(iv) of the NN - 12/2017 42. Thus, from the said explanation it is clear that in the instant case, the State educational boards are educational institutions. Accordingly, the first condition viz. services are provided to educational institution' is satisfied. 43. With respect to the second condition i.e., the services provided are relating to admission to or conduct of examination by the educational institution, it is submitted that there is no doubt that the State Educational Boards conduct the examination and grant degrees/certificates to the students. For this purpose, the educational boards are availing pre and post examination services from the applicant. 44. The applicant submits that the services such as data processing, generation of hall tickets, result processing, scanning of OMR sheets, printing of Memos, etc., provided to the State Education Boards would qualify as services relating to conduct of examination by the educational institutions (State Education Boards in this case). 45. Thus, the second condition specified under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the applicant submits that pre and post examination services being provided to the Universities by the applicant are similar to the services being provided to the State Educational Boards. 50. Further, as mentioned above, conducting of examination is part of education services and any institution providing education as a part of a curriculum for obtaining a qualification recognized by any law for the time being in force is treated as an education institution. Accordingly, any institution conducting examination for obtaining qualification will be treated as an educational institution'. 51. Thus, the applicant submits that Universities are imparting education, conducting examinations and granting certificates/degrees to the students as part of a curriculum for obtaining a qualification. Therefore, the said Universities are also covered under the definition of 'educational institute' as provided under NN-12/2017 52. The services being provided by the applicant to the Universities are in relation to conduct of examination. Accordingly, in this case also the two conditions viz. services are provided to educational institutes and the services are in relation to con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imited [2018-VIL-185-AAR]. In this case, the Hon'ble Advance Ruling Authority has held that the provision of service of scanning of OMR sheets, Bar-codes, printing of marks memos, certificates, etc. to the educational boards and universities are covered under Sl. No.66(b)(iv) of the NN-12/2017 and eligible for exemption from payment of GST. 62. Further, the Hon'ble Authority for Advance Ruling, Andhra Pradesh has also taken similar view in the case of Hitech Print Systems Limited [2021-VIL-296 AAR] and it was held that Printing of Pre- examination items like question papers, OMR sheets (Optical Mark Reading), Answer booklets for conducting of an examination by the educational boards be treated as exempted supply of service. The relevant extract from the ruling given by the Andhra Pradesh Advance Ruling Authority in the said is reproduced below. In the instant case, the educational institutions as referred to by the applicant for whom the supplies of the services of printing of examination related material are made intended to be made are Mumbai university examination Committee, Bihar University Examination Committee, JNTU, Kakinada. All of the three institutions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Open Universities). In this case, the employees of the applicant are deputed at designated Education Boards, Universities, etc., and carryout activities relating to pre and post examinations. 66. Therefore, the applicant submits that in cases where pre and post examination services are provided to the main contractor who in turn provide the same to the educational institutions, then the exemption would also be available to the sub contractor as the services are relating to education and ultimately provided to the educational institutions which impart education to the students, conduct examinations and grant certificates/ degrees to the students. 67. In view of the above, the applicant requests the Hon'ble Authority for Advance Ruling to grant an opportunity of personal hearing to serve the principles of natural justice. 69. The applicant also respectfully prays that they may be permitted to file additional material / written submissions at the time or after the personal hearing as may be required. III. Personal Hearing: The Authorized representatives of the unit namely Sri S. Purushotham, Accountant G. Jagannath, Advocate, authorized representatives of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore it was clarified that GST is exempt on input services relating to admission to, or conduct of examination, such as online testing service, result publication, printing of notification for examination, admit card and questions papers etc, when provided to such Boards under S. No. 66 (b) (iv) of Notification No. 12/2017-CT(R). As seen from the averment of the applicant they claim to supply services which are related to conduct of examination. And the Sl.No.66 of Notification No.12 of 2017-Central Tax (Rate), dt: 28-06-2017 provides for exemption for services related to admission to or conduct of examination by such institution. Further the proviso to the entry at Serial No. 66(b) read as follows earlier to its modification vide Notification No.2 of 2018 to omit the phrase upto higher secondary education from the provision to the said entry : 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 . After omission of the phrase upto higher secondary education service provide to all educational in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... follows- (y) 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; Further, clause (iv) of Explanation of said notification reads as below: (iv) For removal of doubts, it is clarified that the Central and State Educational Boards shall be treated as Educational Institution for the limited purpose of providing services by way of conduct of examination to the students Therefore it was clarified that GST is exempt on input services relating to admission to, or conduct of examination, such as online testing service, result publication, printing of notification for examination, admit card and questions papers etc, when provided to such Boards under S. No. 66 (b) (iv) of Notification No. 12/2017-CT(R). As seen from the averment of the applicant they claim to supply services which are related to conduct of examination. And the Sl.No.66 of Notification No.12 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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