GST ON GUEST LECTURES

[Mr. M. GOVINDARAJAN]

IN RE: SRI SAIRAM GOPALKRISHNA BHAT [2022 (2) TMI 713 - AUTHORITY FOR ADVANCE RULINGS, KARNATAKA], the applicant is a professor of Law at National Law School of India University, Bengaluru.  He is engaged in class room teaching and training for students and other personnel.  He is also invited by multiple Universities and Colleges of repute to deliver guest lectures.  He also provides teaching and training and interconnected activities under Research and Training Projects granted by the Government of India and State Government of Karnataka and International Institutions such as UNDP.

The applicant was advised to register himself with GST regime during February 2019 since he income exceeded ₹ 20 lakhs.  The applicant has obtained registration under GST Act as proprietary concern and his registration was cancelled with effect from 01.09.2019.  Now his status is as unregistered person.

The applicant filed the present application before the Authority for Advance Ruling, Karnataka seeking advance ruling on the following questions-

1. Whether the income earned from conducting guest lectures amounts to or results to as taxable supply of services?
2. Whether the income earned from Research and Training projects funded by Ministries of Government of India and State Government of Karnataka amounts to or results to as taxable supply of service to be taxed at NIL rate as per Heading 9992?
3. Whether the income earned from Research and Training Projects funded by Ministries of Government of India and State Government of Karnataka amounts to or results to as taxable supply to be taxed at (integrated tax) at 18% under Heading 9983?

The Authority for Advance Ruling forwarded a copy of the application to the Commissioner of Central Tax, Bengaluru West Commissionerate, Bengaluru, on 27.10.2021.   The Commissioner gave his comments for the three questions posed by the applicant.

• Qn. No. 1 – The income earned from Guest lectures amounts to supply of taxable services, falling under SAC 9983 – other professional, technical and business services and not fall under exempted category of services.  The services provided by the applicant attract 18% of GST.
• Qn. No. 2 – Since the applicant did not say whether the training program is provided to the Central Government or State Government or Union Territory Administration, the service provided by him attracts 18% of IGST under SAC 9992.  Wherever fee is charged by the Educational Institutions, the service provided is not exempt.
• Qn. No. 3 –No information is forthcoming with regard to recipient of services the services in question merits classification under SAC 9983 and attracts GST @ 18%.

The applicant submitted the following before the Authority for Advance Ruling-

• The applicant is primarily engaged in class room teaching and training for students and other personnel, of various organizations who seek to create a conducive atmosphere for refreshments or capacity building.
• The services provided by him is recreational activities relating to art or culture and as such is not taxable which falls under Entry No. 80 of Notification No. 12/2017, chargeable at NIL.
• The guest lectures rendered by him act as a refreshment or diversion from the usual monotony and serves a recreational purpose.
• He provides teaching and training and interconnected activities under research and training program funds granted by Government of India and Government of Karnataka.
• The services provided by him are pure services falling under item No.3 of Notification No. 12/2017.
• All expenditure in respect of training programs are sponsored by the Funding Agency of the Central and State Government and such services amount to non taxable supply and exempts from the purview of GST.
• These activities amount to technical training and vocational education and as such are wholly exempt from the aspect of taxable supply.

The Authority for Advance Ruling considered the submissions made by the applicant in their application for advance ruling.  The Authority for Advance Ruling observed that the services by way of training or coaching in recreational activities relating to arts or culture or sports by charitable entities are exempted from GST.

The Authority analyzed the Entry No. 80 of Notification No. 12/2017.  The Authority for Advance Ruling observed that the activities of the applicant cover under ‘Other professional, technical and business services’ which is taxable at 18% GST as per Entry No. (ii) of 21 of Notification No.11/0217-Central Tax (Rate), dated 28.06.2017. 

The Authority for Advance Ruling considered the submission that his activities amount to pure services.  The Authority observed that there is no privity of contract between the applicant and the Government and hence the concept of pure services is not applicable to the activities of the applicant.

In regard to the submission of the applicant claiming exemption under item No. 72 of Notification No. 12/2017, two conditions are to be satisfied-

• Training services to be provided only to the Central Government, State Government and Union Territory administration.
• Total expenditure is borne by the Central Government, State Government and Union Territory Administration.

The applicant submitted a copy of MoU signed between Ministry of Environment and Centre for Environmental Law Education, Research and Advocacy and National Law School of University.  The Authority observed that there is no privity of contract between Ministry and the applicant and therefore it is not covered under item No. 72 of the Notification.

The Authority for Advance Ruling ruled as below-

• The income earned from conducting guest lectures amounts to taxable supply as per Entry No. (ii) of 21 of Notification No. 11/2017-Central Tax (Rate), dated 28.06.2017.
• In the absence of the details of ‘recipient of services’, the service in question merits classification under SAC 9983 and attracts GST @ 18%.
• In the absence of the details of the recipient of service, the service in question merits classification under SAC 9983 and attracts GST @ 18%.