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2021 (3) TMI 546 - AAR - GSTExemption from GST - State Examination / Education Board - Eligibility for benefit under Sr.No.5 and Sr.No.66 (a) (aa) of Notification No.12/2017-Central Tax (Rate) dated 28.06.2017 - Education Department came into existence as separate secretariat department, which looks after education including primary education, continuous education, literacy education, secondary education, higher education, technical education, pharmacy education - services supplied by applicant are of conducting of examinations - Governmental Authority or not - HELD THAT - The State Examination Board being one of the sub-divisions of the Education Department of Gujarat, is, therefore, a Board which has been established by the Government of Gujarat itself. Also, as per the submission of the applicant, all the 13 members of the State Examination Board are appointed by the Government of Gujarat and all of them are officers belonging to the State Government or are State Government employees of Gujarat - Besides, on the homepage of the website of State Examination Board, it is seen that the state emblem of India (the adaptation of the Lion Capital of Ashoka) as well as the Swachh Bharat emblem which indicates that the applicant is a Government of Gujarat enterprise or a Government of Gujarat body - Thus, it appears that the State Examination Board is a Board which is fully controlled by the Government of Gujarat through the Members of the said Board who are all appointed by the Government of Gujarat and are all State Government employees and therefore, the said Board appears to be a Government body wholly owned by the State Government of Gujarat. There is an entry at Sr.No.17 of the list of functions entrusted to a Panchayat vide Article 243G of the Constitution which reads as Education, including primary and secondary schools. It is also found that the applicant themselves have referred to the said entry in their submission stating that the services provided by them are in relation of discharge of functions covered under the aforementioned Entry at Sr.No.17 only - As per the definition, Education is the act or process of imparting knowledge, especially at a school, college or university. On comparing the functions of the State Examination with that to the definition of Education , it is found that the function of the applicant does not pertain to imparting of knowledge at school, college or university but pertains to conducting of various types of examinations. However, since the conduct of examinations pertaining to Primary, secondary and higher secondary schools by the applicant would be indirectly related to Education, such type of examinations would get covered under the above entry. Whether the applicant is eligible for exemption as available under Sr.No.5 of Notification No.12/2017-Central Tax (Rate) dated 28.06.2017? - HELD THAT - Since16 of the 23 exams held by the applicant do not get covered under the Entry at Sr.No.17, the services supplied by the applicant in respect of these exams are not eligible for the benefit of exemption available at Sr.No.5 of Notification No.12/2017-Central Tax(Rate) dated 28.06.2017 for the simple reason that the services supplied for these exams are not related to any functions entrusted to the Panchayats under Article 243G of the Constitution of India. However, since the exams listed at Sr.No.9 to 15 of para-5 are covered under Entry at Sr.No.17 of the list mentioned, the services supplied by the applicant in respect of these exams are eligible for the benefit of exemption available at Sr.No.5 of Notification No.12/2017-Central Tax(Rate) dated 28.06.2017. Whether the applicant is eligible for exemption as available under Sr.No.66(a) and (aa) of Notification No.12/2017-Central Tax(Rate) dated 28.06.2017 as amended? - HELD THAT - The applicant has stated that the State Examination Board is a State Educational Board and are therefore covered under the above mentioned clause(iv) and would therefore be eligible for the exemption under Entry No.66(a) and 66(aa) of Notification No.12/2017-central Tax(Rate) dated 28.06.2017, as amended. In this regard, we would like to emphasize that the State Examination Board, although established by the Education Department of the Government of Gujarat, is an autonomous body, established for the sole purpose of conducting various types of examinations and cannot, therefore, be considered as a State Education Board as the functions of the State Examination Board are completely different from that of a State Educational Board - the applicant is not eligible for the benefit of exemption of GST available under Sr.No.66(a) and 66(aa) of Notification No.12/2017-Central Tax(Rate) dated 28.06.2017 as amended from time to time.
Issues Involved:
1. Eligibility for exemption benefit under Sr.No.5 of Notification No.12/2017-Central Tax(Rate) dated 28.06.2017. 2. Eligibility for exemption benefit under Sr.No.66(a) & (aa) of Notification No.12/2017-Central Tax(Rate) dated 28.06.2017. Detailed Analysis: Issue 1: Eligibility for Exemption under Sr.No.5 of Notification No.12/2017-Central Tax(Rate) dated 28.06.2017 The applicant, State Examination Board, seeks exemption under Sr.No.5 of Notification No.12/2017-Central Tax(Rate), which exempts services provided by a Governmental Authority by way of any activity in relation to any function entrusted to a Panchayat under Article 243G of the Constitution. To qualify for this exemption, the applicant must meet the following conditions: 1. The applicant must be a Governmental Authority. 2. The services must relate to functions entrusted to a Panchayat under Article 243G. The State Examination Board is established by the Gujarat Government and controlled by members appointed by the government, thus qualifying as a Governmental Authority. The functions of the Board include conducting various exams, some of which pertain to primary and secondary education, aligning with the functions entrusted to Panchayats under Article 243G. The judgment identifies that out of 23 types of exams conducted by the Board, only 7 exams (Elementary Drawing Grade Exam, Intermediate Drawing Grade Exam, Primary Scholarship Exam, Secondary Scholarship Exam, National Talent Search Exam Stage-1, National Means cum Merit Scholarship-Exam, and Rashtriya Indian Military College Entrance Exam) pertain to primary and secondary education. Therefore, services related to these 7 exams qualify for exemption under Sr.No.5. However, the remaining 16 exams, which are primarily related to employment eligibility and professional qualifications, do not fall under the functions entrusted to Panchayats and hence do not qualify for this exemption. Issue 2: Eligibility for Exemption under Sr.No.66(a) & (aa) of Notification No.12/2017-Central Tax(Rate) dated 28.06.2017 Sr.No.66(a) & (aa) of Notification No.12/2017-Central Tax(Rate) exempts services provided by an educational institution to its students, faculty, and staff, or by way of conducting entrance examinations. An educational institution is defined under Para 2(y) of the notification as an institution providing: 1. Pre-school education and education up to higher secondary school. 2. Education as part of a curriculum for obtaining a qualification recognized by law. 3. Education as part of an approved vocational education course. The State Examination Board conducts various exams but does not impart education directly. It is not involved in pre-school or higher secondary education, nor does it provide education as part of a recognized curriculum or vocational course. Therefore, it does not meet the definition of an educational institution. Despite the amendment in Notification No.14/2018-Central Tax(Rate) clarifying that Central and State Educational Boards are treated as educational institutions for conducting exams, the Board's primary function is conducting exams, not imparting education. Hence, it does not qualify for exemption under Sr.No.66(a) & (aa). Ruling: 1. The applicant is eligible for exemption under Sr.No.5 of Notification No.12/2017-Central Tax(Rate) for services related to the 7 exams pertaining to primary and secondary education (Sr.No.9 to 15 of the list). No exemption is available for services related to the other 16 exams (Sr.No.1 to 8 and 16 to 23). 2. The applicant is not eligible for exemption under Sr.No.66(a) & (aa) of Notification No.12/2017-Central Tax(Rate), as it does not qualify as an educational institution under the defined terms.
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