TMI Blog2023 (11) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... 28.06.2017, has a broader subject when it prescribes education service and Notification No. 12 of 2017, dated 28.06.2017, specifically enumerates specific services which stand exempted and inspection and affiliation fees not reflected in the Notification No. 12 of 2017, dated 28.06.2017, the relief sought for by the petitioners or the issue raised by the petitioners would not be sustainable - Notification No. 12 of 2017, dated 28.06.2017, which stood amended further vide Notification No. 2 of 2018, dated 25.01.2018, specifically enumerates the specific nature of service rendered by the educational institutions which would stand exempted. Inspection and affiliation fees however is not part of the said notification granting exemption. There are no substance in the contentions raised by the learned counsel for the petitioners - petition dismissed. - HONOURABLE SRI JUSTICE P. SAM KOSHY AND HONOURABLE SRI JUSTICE LAXMI NARAYANA ALISHETTY For the Petitioner(s) : Mr. Gaddam Srinivas For the Respondent(s) : None for 1st respondent-University; Mr. Dominic Fernandes, learned Senior Standing Counsel for respondent Nos. 2 and 3; Mr. V. Rajeshwar Rao, learned Government Plea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ersity of Health Sciences (K.N.R.U.H.S.) 6. All the petitioners in the present writ petition as also in the other connected writ petitions are educational institutions / colleges primarily imparting nursing course. All the colleges before this Court in the various writ petitions are all affiliated with the 1st respondent-Kaloji Narayana Rao University of Health Sciences (K.N.R.U.H.S.), (for short, the 1st respondent- University ). 7. The 1st respondent is a University which has been established under the provisions of Act 6 of 1986. The colleges which intend to get affiliation the 1st respondent-University are required to undergo certain procedure. For the purpose of granting affiliation, the 1st respondent-University is required to first conduct an inspection and for this purpose, the University charges inspection fees as also affiliation fees from the respective colleges. All the colleges in this batch of writ petitions have paid the inspection fees for the inspection conducted as also the affiliation fees for the affiliation granted. 8. The G.S.T. law came into force w.e.f. 01.07.2017. 9. Recently, the respondent Nos. 2 and 3 have raised demand of G.S.T. on the affi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed upon a recent decision of a learned Single Judge of the Karnataka High Court in M/s. Rajiv Gandhi University of Health Sciences vs. Principal Additional Director General, Directorate General of GST Intelligence and others W.P. No. 57941 of 2018, decided on 26.07.2022 and also in M/s. Bangalore University vs. Principal Additional Director General, Directorate General of GST Intelligence and others W.P. No. 112 of 2019, decided on 26.07.2022, wherein the learned Single Judge allowed the said writ petitions by setting aside the show-cause notice and also the consequent further actions as well, raised by the University from the respective colleges. 13. Additionally, learned counsel for the petitioners also placed reliance on the following decisions of the Hon ble Apex Court in The Principal and others vs. The Presiding Officer and others (1978) 1 S.C.C. 498, Chairman, Bhartia Education Society vs. State of Himachal Pradesh (2011) 4 S.C.C. 527 and Maharishi Markandeshwar Medical College and Hospital vs. State of Himachal Pradesh (2017) 6 S.C.C. 675. 14. Learned counsel for the petitioners relied on the above decisions to show that affiliation is intrinsically conne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d it is that which is reflected upon in Serial No. 66 of the said notification. Clause (a) of Serial No. 66 under the same Heading 9992 prescribing services provided by an educational institution to its students, faculty and staff to be one under the exempted category so far as the levy of tax is concerned. 18. According to learned counsel for the respondent- Department, a plain reading of Serial No. 66 (which was further amended vide Notification No. 2 of 2018, dated 25.01.2018) would go to show that the collection of affiliation fees and inspection fees does not stand exempted. It was the further contention of learned counsel for the respondent-Department that, in the 47th G.S.T. Council Meeting held on 28/ 29.06.2022, one of the topic of discussion in their agenda was in respect of the confusion that prevailed regarding the taxability of G.S.T. on sale of application forms to the prospective students, issue of migration, eligibility forms to graduate students, affiliation works and other educational activities. In this context, the G.S.T. Council had in its aforesaid meeting categorically resolved that the services provided by the educational institutions to its students, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8.06.2017 which first reflected the description of the services which would be taxable and also reflected the headings and the rate of charges of G.S.T. upon each of the services notified therein. 23. Serial No. 30 of Notification No. 11 of 2017, dated 28.06.2017 is the head subject which is relevant for the decision of this Court, which for ready reference is extracted hereunder : Notification No. 11/2017-Central Tax (Rate) New Delhi, the 28th June, 2017 G.S.R . (E) In exercise of the powers conferred by subsection (1) of Section 9, sub-section (1) of Section 11, sub-section (5) of section 15 and sub-section (1) of Section 16 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, and on being satisfied that it is necessary in the public interest so to do, hereby notifies that the central tax, on the intra-State supply of services of description as specified in column (3) of the Table below, falling under Chapter, Section or Heading of scheme of classification of services as specified in column (2), shall be levied at the rate as specified in the corresponding entry in Column (4), subje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aff; (ii) catering, including any mid-day meals scheme sponsored by 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. 9 - 26. The above notification stood amended vide Notification No. 2 of 2018, dated 25.01.2018, wherein Clause (aa) was also inserted after Clause (a) under Serial No. 66, which reads as under : (o) against serial number 66, in the entry in column (3) (i) after item (a), the following item shall be inserted, viz., (aa) by an educational institution by way of conduct of entrance examination against consideration in the form of entrance fee. 27. The aforesaid amendment was brought by virtue of a decision that was ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rds the question of granting exemption to the affiliation and other fees collected by the 1st respondent- University, it is the Circular dated 17.06.2021 issued by the Government of India which would govern the field and clause (4) thereof reads as under : 4. Taking into account the above, the G.S.T. Council has recommended, to clarify as below : (i) G.S.T. is exempt on services provided by Central or State Boards (including the boards such as NBE) by way of conduct of examination for the students, including conduct of entrance examination for admission to educational institution [under S.No. 66(aa) of Notif. No. 12/2017-CT(R)]. Therefore, G.S.T. shall not apply to any fee or any amount charged by such Boards for conduct of such examinations including entrance examinations. (ii) G.S.T. is also 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 question papers, etc., when provided to such Boards [under S.No. 66(b)(iv) of Notif. No. 12/2017-CT(R)]. (iii) G.S.T. at the rate of 18% applies to other services provided by such Board ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not commenced. It is at the inception stage of the educational institutions that the inspection is conducted and the affiliation is thereafter granted. The admission and the services rendered by the educational institutions to the students, the faculty and the staff are all services rendered subsequent to the affiliation. Therefore, the contention that the petitioners have canvassed is hard to accept. 33. The Constitution Bench decision of the Hon ble Apex Court rendered in the case of Commissioner of Customs (Import), Mumbai vs. M/s. Dilip Kumar and Company (2018) 9 S.C.C. 1 (F.B.) (S.C.), dealing with the situation where there is any doubt or confusion so far as claiming of exemption is concerned (though there is none in the present writ petition so far as this Bench is concerned) the Hon ble apex Court held at para Nos. 48 to 51 as under : 48. The next authority, which needs to be referred is Mangalore Chemicals [Mangalore Chemicals and Fertilisers Ltd. v. CCT, 1992 Supp (1) SCC 21]. 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, be clear. Exem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndia Ltd. v. CCE, 1994 Supp (3) SCC 606] ). 51. In Hari Chand case [CCE v. Hari Chand Shri Gopal, (2011) 1 SCC 236], as already discussed, the question was whether a person claiming exemption is required to comply with the procedure strictly to avail the benefit. The question posed and decided was indeed different. The said decision, which we have already discussed supra, however, indicates that while construing an exemption notification, the Court has to distinguish the conditions which require strict compliance, the non-compliance of which would render the assessee ineligible to claim exemption and those which require substantial compliance to be entitled for exemption. We are pointing out this aspect to dispel any doubt about the legal position as explored in this decision. As already concluded in para 50 above, we may reiterate that we are only concerned in this case with a situation where there is ambiguity in an exemption notification or exemption clause, in which event the benefit of such ambiguity cannot be extended to the subject/assessee by applying the principle that an obscure and/or ambiguity or doubtful fiscal statute must receive a construction favouring th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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