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2022 (2) TMI 1211 - AAR - GSTExemption from GST - services supplied by the applicant by way of educating and training physical, mental and spiritual practices of Yoga - benefit of exemption under N/N. 12/2017-CT Rate dated 28.06.2017 under entry number 80? - HELD THAT - The activity of offering of various courses of Yoga for improving mental and physical wellness for consideration in form of fees is covered under 'supply' as per section 7 of the CGST Act, 2017 - On going through entry 80 of the Notification No. 12- CT(R) dated 28-06-2017, it is said that there should be training or coaching in recreational activities. The entry No. 80 of the Notification No. 12/2017-CT(R) dated 28-06-2017 and entry No. 711 of the Notification No. 11/2017-CT(R) dated 28-06-2017, we are of the view that services by way of training or coaching of various Yoga courses by applicant for consideration, is not exactly for Recreation activity whereas the same is for 'Physical well-being activities' and hence, it is not covered under entry No. 80 of the Notification No. 12/2017-CT(R) dated 28-06-2017. Further, as per circular No. 66/40/2018-GST dated 26.09.2018, only those services which provided by entity registered under Section 12AA of the Income Tax Act, 1961 by way of advancement of religion, spirituality or yoga, are exempt. The essence of the said circular is to provide exemption in respect of services of advancement of yoga to only those entities who registered under Section 12AA of the Income Tax Act, 1961 - the intention of the law maker in respect of entry No. 80 of the Notification No. 12/2017-CT(R) dated 28-06-2017, is to provide benefits of GST exemption to only those entities which are registered under Section 12AA of the Income Tax Act, 1961. This intention also confirmed from the aforesaid circular No. 66/40/2018-GST dated 26.09.2018. As the applicant (as mentioned in their written submission) is not registered under Section 12AA of the Income Tax Act, 1961, therefore in light of the circular, the applicant is not eligible to avail benefits of entry No. 80 of the Notification No. 12/2017-CT(R) dated 28-06-2017. The training or coaching of various courses of Yoga for consideration by the applicant is nothing but Physical well-being service and more suitably covered under Service Description Physical wellbeing including health club and fitness centre under Entry No. 711 of the Notification No. 11/2017-CT(R) dated 28-06-2017 and attracts GST @ 18% as per Entry No. 35 of the Notification No. 11/2017-CT(R) dated 28-06-2017.
Issues Involved:
1. Applicability of a notification issued under the provisions of the Act. 2. Determination of the liability to pay tax on any goods or services or both. Issue-wise Detailed Analysis: 1. Applicability of Notification No. 12/2017-CT (Rate) dated 28.06.2017: The applicant, M/s Stonorti Marketplace Private Limited, engaged in providing Yoga training and coaching, sought clarification on whether their services are exempt under Entry 80 of Notification No. 12/2017-CT (Rate) dated 28.06.2017. The applicant argued that their services fall under "training or coaching in recreational activities relating to arts or culture," and hence should be exempt from GST. The notification in question exempts services by way of training or coaching in recreational activities related to arts, culture, or sports by entities registered under section 12AA of the Income-tax Act. The applicant contended that Yoga qualifies as a recreational activity related to culture, citing its roots in Indian culture and its recognition by UNESCO as part of the Intangible Cultural Heritage of Humanity. 2. Determination of Liability to Pay Tax: The authority examined whether the applicant's services of Yoga training qualify as "recreational activities" under Entry 80. The term "recreational activity" was defined using various dictionaries and legal precedents, emphasizing activities done for enjoyment, amusement, or pleasure. The authority noted that Yoga, as described by the applicant, is more aligned with physical and mental wellness rather than mere recreation. The authority further analyzed the notification and concluded that the intention of the lawmaker was to provide GST exemption only to entities registered under section 12AA of the Income-tax Act for activities related to arts, culture, or sports. Since the applicant is not registered under section 12AA, their services do not qualify for exemption under Entry 80. Additionally, the authority referenced Circular No. 66/40/2018-GST dated 26.09.2018, which clarifies that only entities registered under section 12AA providing services for the advancement of religion, spirituality, or yoga are exempt from GST. The applicant's services, being aimed at physical well-being, do not fall under this exemption. Conclusion: The authority ruled that the services provided by the applicant, involving the training and coaching of Yoga for physical and mental wellness, do not qualify as "recreational activities" under Entry 80 of Notification No. 12/2017-CT (Rate) dated 28.06.2017. Instead, these services are classified under "Physical well-being including health club and fitness centre" and are subject to GST at 18% (9% CGST + 9% SGST) as per Entry No. 35 of Notification No. 11/2017-CT (Rate) dated 28.06.2017. Ruling: Question: Whether the services supplied by the applicant by way of educating and training physical, mental, and spiritual practices of Yoga are exempted under Notification No. 12/2017-CT Rate dated 28.06.2017 under entry number 80? Answer: No, it is not exempted. It will be covered under the service description "Physical well-being including health club and fitness centre" under service code 999723 and will attract GST at 18% (9% CGST + 9% SGST) as per Entry No. 35 of Notification No. 11/2017-CT (Rate) dated 28-06-2017.
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