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TMI Blog2024 (9) TMI 243X X X X Extracts X X X X X X X X Extracts X X X X ..... taxable service namely, Health Club & Fitness Service, Renting of Immovable Property Service and Health Care Service. The Department on the basis of Form 26AS ascertained that the appellant had collected amount from Life Care Medicos, i.e. in-house Medical store under Section 194H of Income Tax Act, 1961, which pertains to commission or brokerage and had not paid any service tax. The explanation was sought from the appellant vide letter dated 20.12.2017, 23.05.2018, 06.06.2018 and 21.08.2018 on receipts from Life Care Medicos. The appellant failed to appear and only submitted its response vide letter dated 06.09.2018. 3. Show cause notice dated 8.9.2020 was issued on the ground that during the period 2015-2016 to June 2017 the appellant h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es, etc. since the said claim also consists of medicine charges in respect of the medicine provided by M/s. Life Care Medicos to the patient, therefore, while filing the mediclaim, the medicine charges are also claimed in the Mediclaim filed with respective insurance company. That after receipt of the Mediclaim amount the appellant transfer the charges of medicine received from insurance company to M/s. Life Care Medicos after deducting their nominal service charges. Therefore, the amount received from M/s. Life Care Medicos is nothing but service charges related to preparation and collecting the mediclaim of patient including claim of medicine charges of M/s. Life Care Medicos. The learned Counsel relied on the definition of "Clinical Es ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mbursed amount on account of 'service charges' and after deducting the said amount the remaining amount due to the medical store is paid. The claim of the appellant is that for preparing the Mediclaim considerable time of the staff is consumed for which they are taking the service charges from the medical store from whom the medicines were received. The contention of the appellant is that these charges are nothing but part and parcel of the healthcare services which is their primary function. 9. To further appreciate the controversy the scheme of the statutory provisions applicable is required to be considered. During the period 1.7.2010 to 1.5.2011, the health care services were only taxed for specified category of hospitals and for speci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nital defects, developmental abnormalities, injury or trauma." 11. The two definitions of "clinical establishment" and "healthcare service" clearly shows that they have been worded very broadly so as to include the various services, which are connected with the healthcare service and are inbuilt in it. The appellant who is running the hospital is squarely covered by the definition of "clinical establishment", which at the outset says the clinical establishment means hospital and is rendering the healthcare services as defined therein. The definition of "healthcare service" when it uses the term diagnosis or treatment or care for illness, etc. by any recognised system of medicines, denotes that the provision for medicines to the patients is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dicines etc. In order to have smooth functioning for disbursing the amounts, the staff of the hospital has to be utilized and involved for which they are deducting some amount. Hence the allegation raised by the revenue that this amount is actually the commission which the hospital is charging from the medicine store is not correct. 13. For understanding the concept of the term 'treatment' , it is necessary to keep in mind that the drug therapy is an important and integral part of treatment. The medicines are used to treat or cure illness along with that the intended use of the medicines is in the diagnosis, mitigation or prevention of disease. According to the Britanica, medication is a substance used in treating a disease or relieving pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ending to the patients for treatment using his professional skills and knowledge and the hospitals are managing the patients from the time they enter the hospital till they leave the premises. The appellant hospitals also manages follow-up procedures and provide for further health care services in the manner as required by the patients. The appellant hospitals are availing the professional services of the doctors for providing health care services, for which they are paying the doctors. However, the retained money out of the money charged from the patients is also for such heath care services. Noting the definition of the 'Clinical Establishments" and "Health Care Services", as defined in the Notification No.25/2012-ST, the Tribunal observe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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