2025 (3) TMI 473 - AAR - GST

Exempted supply of service in terms of Sl. No.66 of Notification No. 12/2017-CGST(Rate) dated 28-06-2017 as amended by Notification No. 2/2018-CT(Rate) dated 25-01-2018 or not - printing of pre-examination items like hall tickets question paper OMR sheets Answer booklet for conducting examination by the educational boards - printing of post examination items like mark sheets Degree certificate grade sheets rank sheets rank cards certificates to educational boards after scanning the OMR sheets and processing of data in relation to conduct of examination - scanning and processing of results of the examination. Whether the supply of test papers/question papers by the applicant for educational institutes should be treated as supply of goods or supply of services as the applicant makes the supply using the paper and ink owned by him? - HELD THAT - The supply made by the applicant cannot be classified as selling of question papers to the educational institutes as the content to be printed on them is given by the latter to the applicant. The supply of Printed materials as required by the institution cannot be in toto categorised as supply of goods to the educational institutes as this is not a ready-made printed material bought by recipient who does not own the content in the material to be bought but it is a composite supply of providing printing services on the papers owned by him. This composite supply involves both supply of printing services and supply of the paper owned by him on which the printing is done as per the content given by the educational institutes - The supply of papers is an integral part of the composite supply without which the contents cannot be printed. But the same cannot be called as principal supply as the purpose for which the educational institutes contracted with applicant is not for buying papers but for the printing services. The content to be printed is based on the specifications given by the educational institutes and the applicant has no role in deciding the same. Therefore supply of printing of the content supplied by the recipient of supply is the principal supply and the same is clarified by Circular No. 11/11/2017-GST dated 20-10-2017. Applicability of Sr. No. 66 of N/N. 12/2017-Central Tax (Rate) dated 28-6-2017 as amended vide clause (o) of N/N. 2/2018-Central Tax (Rate) dated 25-1-2018 read with Sr. No. 27 of N/N. 11/2017-Central Tax (Rate) dated 28-6-2017 - HELD THAT - As per Sr. No. 66 (b) (iv) of Notification No. 12/2017-Central Tax (Rate) as amended services provided to an educational institution by way of services relating to admission to or conduct of examination by such institution is exempted from payment of Goods and Services Tax. It is to be noted that exemption is given only to services and not to goods in this Notification and the principal supply of the composite supply made by the applicant is printing services. This is a composite supply of which Printing services is the principal supply as defined under Section 2(90) of the Central Goods and Services Tax Act which makes HSN classification of the supply to be done on printing services which falls under Heading 9989. As it is a service done to educational institutions the exemption under S. No. 66 (b) (iv) of Notification No. 12/2017-CT(Rate) dated 28-06-2017 is eligible as the said Notification details the services provided to educational institution which are exempt. The same is clarified by Circular No. 151/07/2021-GST dated 17-6-2021 while dealing with the issue of supply of various services by National and State Boards. Conclusion - i) Services of printing of pre-examination items like hall tickets question paper OMR sheets answer booklet provided to Educational Institutions for conducting examination shall be treated as exempted supply in terms of serial No. 66 of N/N. 12/2017-CT(Rate) dated 28-06-2017 as amended by N/N. 02/2018-CT(Rate) dated 25-01-2018. ii) Services of printing of post-examination items like mark sheets Degree Certificates grade sheets rank sheets rank cards certificates to educational boards after scanning the OMR sheets and processing of data provided to Educational Institutions in relation to conduct of examination shall also be treated as exempted supply in terms of serial No. 66 of N/N. 12/2017-CT(Rate) dated 28-06-2017 as amended by N/N. 02/2018-CT(Rate) dated 25-01-2018. iii) Services of scanning and process of results of the examination for an Educational Institution shall be treated as exempted supply in terms of serial No. 66 of N/N. 12/2017-CT(Rate) dated 28-06-2017 as amended by N/N. 02/2018-CT(Rate) dated 25-01-2018.

Summary

1. ISSUES PRESENTED and CONSIDERED

The core legal questions considered in the judgment are:

• Whether the printing of pre-examination items such as hall tickets, question papers, OMR sheets, and answer booklets for conducting examinations by educational boards is treated as an exempted supply of service under Sl. No. 66 of Notification No. 12/2017-CGST(Rate) as amended.
• Whether the printing of post-examination items like mark sheets, degree certificates, grade sheets, rank sheets, rank cards, and certificates to educational boards, after scanning OMR sheets and processing data, is treated as an exempted supply.
• Whether the scanning and processing of examination results is treated as an exempted supply of services under the same notification.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Printing of Pre-Examination Items

• Relevant Legal Framework and Precedents: The relevant legal framework includes Sl. No. 66 of Notification No. 12/2017-CGST(Rate), which exempts services provided to educational institutions relating to the conduct of examinations.
• Court's Interpretation and Reasoning: The Court interpreted that the services provided by the applicant, which involve printing pre-examination items, qualify as services related to the conduct of examinations and thus fall under the exemption provided in the notification.
• Key Evidence and Findings: The applicant provides printing services using their own materials, but the content is provided by educational institutions, indicating a composite supply where the principal supply is the service of printing.
• Application of Law to Facts: The exemption applies since the services are directly related to the conduct of examinations by educational institutions.
• Treatment of Competing Arguments: The applicant's argument that the services are exempt was supported by previous rulings and circulars which clarified similar exemptions.
• Conclusions: The printing of pre-examination items is exempt from GST.

Issue 2: Printing of Post-Examination Items

• Relevant Legal Framework and Precedents: The same notification applies, exempting services related to the conduct of examinations.
• Court's Interpretation and Reasoning: The Court reasoned that post-examination services, such as printing mark sheets and certificates, are part of the examination process and thus exempt.
• Key Evidence and Findings: The applicant's services include processing data and printing results, which are integral to the examination process.
• Application of Law to Facts: The services are exempt as they are essential to the examination process conducted by educational institutions.
• Treatment of Competing Arguments: The applicant's position was consistent with the notification and supported by existing circulars.
• Conclusions: The printing of post-examination items is exempt from GST.

Issue 3: Scanning and Processing of Examination Results

• Relevant Legal Framework and Precedents: The exemption under the same notification applies to services related to the conduct of examinations.
• Court's Interpretation and Reasoning: The Court found that scanning and processing results are services related to the examination process and thus exempt.
• Key Evidence and Findings: The services provided are crucial for the completion of the examination process.
• Application of Law to Facts: As part of the examination process, these services are exempt under the notification.
• Treatment of Competing Arguments: The applicant's claim was supported by the notification's clear language and previous clarifications.
• Conclusions: Scanning and processing of examination results are exempt from GST.

3. SIGNIFICANT HOLDINGS

• Core Principles Established: Services that are directly related to the conduct of examinations by educational institutions are exempt from GST under Sl. No. 66 of Notification No. 12/2017-CGST(Rate).
• Final Determinations on Each Issue:
• The printing of pre-examination items is exempt from GST.
• The printing of post-examination items is exempt from GST.
• Scanning and processing of examination results are exempt from GST.
• Verbatim Quotes of Crucial Legal Reasoning: "Services of printing of pre-examination items like hall tickets, question paper, OMR sheets, answer booklet provided to Educational Institutions' for conducting examination shall be treated as exempted supply in terms of serial No. 66 of Notification No. 12/2017-CT(Rate) dated 28-06-2017 as amended."