2019 (11) TMI 531 - AAR - GST

Exemption from GST - Charitable Activities or not - Activities for Promotion of research in the field of Life Sciences, Physical Sciences etc, Performing publishing of online research journals on one or more of above-mentioned field/subjects and Organizing Seminars, Symposiums, Conventions, Congress etc. addressing on one or more of various issues - applicability of clause 2(r) of Notification No. 12/2017 - Central Tax (Rate) dated 28.06.2017. HELD THAT - The definition of Charitable Activity is not an inclusive definition but an exclusive one, meaning that the specific activities which are treated to be falling under Charitable Activity are an exhaustive list and there is no scope of interpretation as to which activities might fall under charitable category - A joint reading of activities covered under the Notification and the activities performed show that Promotions of Research and Publishing of online research journal are not activities contemplated in the exemption entry since they do not fall under care or counselling; or spreading public awareness; or advancement of religion, spirituality or yoga; or advancement of educational programmes or skill development. Organization of Seminars, Symposiums and Conventions come under the term spreading of public awareness , if they are for the spreading of Public Awareness of preventive health, family planning or prevention of HIV infection shall be covered under the exemption notification. The determinative factor in this case would be to ascertain whether the programme is open for public or not - Once it is established that it is not for select group of people or for a class of people, then such activity ceases to a Public Awareness activity. Since the applicability of the exemption is dependent on whether the activity is for Public Awareness, which is a fact to be ascertained from each case. In such case, Advance Ruling cannot be passed in absence of facts. Thus, the activities of Promotion of Research and activity of Performing and publishing online research journal does not fall under Charitable Activity under Notification No 12/2017 - CT (R) and corresponding notification issued under MPGST Act.

Summary

Issues:
1. Interpretation of charitable activities under Notification No. 12/2017 - Central Tax (Rate) dated 28.06.2017 for GST exemption.

Analysis:
The case involves an application filed by an international not-for-profit company engaged in research activities seeking clarification on whether their activities qualify as charitable activities under GST law for exemption. The applicant's activities include promoting research, publishing online research journals, and organizing seminars on various subjects. The main question raised is whether these activities fall under the definition of charitable activities as per the relevant notification, leading to a nil rate of GST.

The concerned officer opined that the applicant's activities lack detailed facts, making them ineligible for exemption under the said notification. However, during the personal hearing, the applicant reiterated their activities and highlighted their registration under section 12AA of the Income Tax Act, 1961, which is a prerequisite for charitable activities to be eligible for nil-rated GST.

Upon deliberation, the Authority examined the relevant entry in Notification No. 12/2017 - Central Tax (Rate) and its corresponding provision under the MPGST Act. The notification specifies charitable activities, including public health, advancement of religion, educational programs, and environmental preservation, that qualify for exemption. The definition of charitable activities provided in the notification is exclusive, leaving no room for interpretation beyond the specified activities.

The Authority concluded that the applicant's activities, such as research promotion and online journal publication, do not align with the charitable activities outlined in the notification. While organizing seminars could potentially qualify as spreading public awareness for exemption, it hinges on whether the programs are open to the public. Without specific details on the nature of the seminars, an advance ruling cannot be issued regarding their exemption status.

Therefore, the ruling stated that the applicant's research promotion and journal publication activities do not fall under charitable activities for GST exemption. The decision is subject to the provisions of the GST Act unless declared void under the relevant sections. The ruling emphasizes the need for activities to align with the specified charitable categories to qualify for GST exemption, highlighting the importance of clear delineation in the law for such determinations.