2019 (3) TMI 1015 - AAAR - GST

Educational institution or not - IIM, Calcutta - Exemption under Entry No. 66(a) of the Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017 - refund of tax - Held that - The Indian Institute of Management Act, 2017, which came into force on and from 31.01.2018, granted IIMs the status of institutions of national importance and they were empowered to grant degrees, diplomas and other academic distinctions or tiles. Thus the Respondent is an Educational Institution within the meaning of sub-clause (ii) of clause 2(y) of Notification No. 12/2017-Central Tax (Rate) dated 28/06/2017, with effect from 31.01.2018. Circular No. 82/01/2019-GST (F. No. 354/428/2018-TRU) dated 01.01.2019 issued by the Government of India, Ministry of Finance, Department of Revenue, Tax Research Unit, dealt with the applicability of GST on various programmes conducted by the IIMs. It clarified that from 01.07.2017 to 30.01.2018, 11Ms were not covered by the definition of education institutions as given in Notification No. 12/2017-Central Tax (Rate) dated 28/06/2017 thus they were not entitled to exemption under serial No. 66 of the said Notification. However, 11Ms were entitled to exemption for specific programmes falling under serial No. 67 of the Notification. Thus, the Indian Institute of Management, Calcutta, the Respondent, is an 'education institution' in terms of meaning of clause 2(y) of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 after the enactment of IIM Act on and from 31.01.2018 - The exemption from GST under serial No. 66 of the said Notification was not available to the Respondent from 01.07.2017 to 30.01.2018, however, during this period exemption was available for specific programmes under serial No. 67. Further, for the period 31.01.2018 to 31.12.2018, the Respondent could avail exemption for the eligible programmes either under serial No. 66 or serial No. 67. After the deletion of serial No. 67 with effect from 01.01.2019, the exemption is available under entry 66.

Summary

Issues Involved:
Appeal against Advance Ruling on the classification of an educational institution under GST laws and eligibility for exemptions and refunds.

Analysis:

Issue 1: Classification as an Educational Institution
The Appellant challenged the Advance Ruling that classified the Indian Institute of Management, Calcutta as an "educational institution" under the GST Act. The Appellant argued that specific provisions in the exemption notification should be considered, distinguishing IIMs from other educational institutions. The Appellant contended that the qualifications offered by IIMs must be recognized by law, questioning the authority of IIMs to confer degrees without UGC approval. However, the Appellate Authority upheld the classification, citing the IIM Act of 2017 granting IIMs the status of "institutions of national importance" and empowering them to provide recognized qualifications.

Issue 2: Eligibility for Exemptions
The Appellant disputed the eligibility of IIM, Calcutta for exemption under Entry No. 66(a) of the Notification, arguing that the specific provisions for IIMs under Entry No. 67 should prevail. The Circular issued by the Ministry of Finance clarified the applicability of GST on IIM courses, stating that IIMs were entitled to specific exemptions under Entry No. 67 until 31st January 2018. From 31st January 2018 to 31st December 2018, IIMs could choose to avail exemptions under either Entry No. 66 or Entry No. 67. The Appellate Authority aligned with the Circular's interpretation, allowing IIM, Calcutta to avail exemptions under Entry No. 66 post the deletion of Entry No. 67.

Issue 3: Refund of Tax Amount
The Appellant raised concerns regarding the refund of tax amounts already paid by IIM, Calcutta. However, the judgment primarily focused on the classification and eligibility for exemptions, and no specific ruling was provided regarding the refund issue. The Appellate Authority's decision modified the initial Advance Ruling, emphasizing the eligibility of IIM, Calcutta for exemptions under specific entries based on the Circular's guidance.

In conclusion, the Appellate Authority for Advance Ruling, West Bengal modified the initial ruling, confirming the classification of IIM, Calcutta as an educational institution under the GST Act and determining its eligibility for exemptions based on specific entries in the Notification. The judgment aligned with the Circular's clarification on the applicability of GST exemptions to IIMs, resolving the ambiguity and providing clarity on the tax treatment of IIM courses.