9911796707
TMI Blog2020 (8) TMI 524X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the interest of justice, and considering the fact that the delay is within the condonable powers of this Authority, we are inclined to condone the delay in filing this appeal and proceed with a decision on the merits of this case. Eligibility for exemption from GST under Notification No.2/2018- Central Tax (Rate) - supply of services in the nature of subscription to the J-Gate by the educational institutions - HELD THAT:- The services provided to an educational institution by way of supply of online journals and periodicals is exempted from the levy of GST with effect from 25th Jan 2018. However, the exemption is not available when the supply of online journals and periodicals is to institutions providing pre-school education, education up to higher secondary school or its equivalent and vocational educational institutions. Pursuant to this exemption coming into force, the Appellant applied for an advance ruling whether they are eligible for the benefit of sub-clause (v) of clause (b) of entry No 66 of Notification No. 12/2017 Central Tax (Rate) dt 28-06-2017 as amended. The lower Authority has held that the transaction of supply of information by the appellant is a su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... own an online educational journal portal called J-Gate, which is a platform for various educational journals. The appellant enters into contracts with publishers for listing their scholarly journal on J-Gate. The platform qualifies as the world s largest database of scholarly journal articles. J-Gate includes full text access to over 25000 journals. 4. J-Gate indexes and aggregates articles from the peer-reviewed scholarly journals in all discipline sets such as Physical science and Life Sciences, engineering and Technology, Health Sciences, Economics, Laws, Social Sciences, etc. required by higher education institutions. J-Gate platform indexes millions of articles from several thousand online journals of interest to educational institutions. The journals are updated on a monthly or bi-monthly or quarterly basis. Being the platform for various scholarly and scientific journals, many educational institutions subscribe to J-Gate to have access to hundreds and thousands of educational journals. 5. The appellant charges the subscribing institutions an annual subscription fee, depending on the disciplines from which the journals are required to be accessed. 6. Exemption No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... publishing any online journals. However, both owning the data and publishing is not a requirement by law. They submitted that the exemption entry simply reads Supply of online educational journals and periodicals ; that it does not specify that the data in the journal should be owned by the supplier. Neither does it specify that the exemption is available only if the journal is supplied by the publisher; that there are no provisions under GST laws wherein supplier is necessitated to own the data or publish the data in order to consider the transaction as supply of online educational journal. They submitted that the Authority has misled itself with these preconditions without any legal basis and hence the ruling is required to be set aside. 8.3. They submitted that the lower authority has arrived at a conclusion that the appellant is only aggregating the data and not supplying e-journals; that the authority does not appear to have understood the nature of the transactions of the Appellant. They submitted that all the articles published in a particular journal listed in J-Gate are made available in the J-Gate portal; that a subscriber to J-Gate will be able to access all the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct their customers with the publishers; that even when the contract with the publisher terminates, they continue to retain the data received till date of termination so that they can continue to fulfill their obligations to their customers. Therefore, they are making available the e-journals to their customers and not connecting the customers to the publisher. 8.6. The Appellant submitted that the lower Authority has misconstrued the aspect of metadata and wrongly held that metadata is only gist and is not the complete journal and hence is only a database. In this regard they submitted that providing metadata in the portal is only a business strategy and not a supply as such; that by subscribing to the full text journal, people can read the metadata freely; that they collect subscription fees for the journals and not for the metadata; that metadata is only an additional feature of the portal which has nothing to do with the journal subscription; that even in the case of restricted access journals, the process will be the same except the fact that to access such journals additional requirement of subscribing to specific publisher exists; that the subscription to the publisher is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the service provided by them was never a question posed to the lower Authority in their application for advance ruling and hence the ruling given on the classification is required to be set aside. DISCUSSIONS AND FINDINGS 14. We have gone through the records of the case and considered the submissions made by the Appellant in their grounds of appeal as well as at the time of personal hearing. The issue before us is regarding the Appellants eligibility to exemption in terms of entry Sl.No. 66 of Notification No 12/2017 CT (R) dated 28-06-2018 as amended vide Notification No 02/2018 CT (R) dated 25-01-2018. 15. Before we proceed with the main issue, we find that there has been a delay in filing the present appeal. The order of the Authority of Advance Ruling dated 23.09.2019 was admittedly received by the appellant on 3 rd October 2019. The statutory period for filing the appeal (which is 30 days from the date of receipt of the order) expired on 2 nd November 2019. However, the appeal was filed before this Appellate Authority on 12 th November 2019 after a delay of 10 days from the statutory due date. The appellant has sought for condonation of delay in filing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing contained in sub-items (i), (ii) and (iii) of item (b) shall apply to an educational institution other than an institution providing services by way of pre-school education and education up to higher secondary school or equivalent. Provided further that nothing contained in sub-item (v) of item (b) shall apply to an institution providing services by way of,- (i) pre-school education and education up to higher secondary school or equivalent; or (ii) education as a part of an approved vocational education course. NIL NIL 19. From the above it is seen that services provided to an educational institution by way of supply of online journals and periodicals is exempted from the levy of GST with effect from 25th Jan 2018. However, the exemption is not available when the supply of online journals and periodicals is to institutions providing pre-school education, education up to higher secondary school or its equivalent and vocational educational institutions. Pursuant to this exemption coming into force, the Appellant applied for an advance ruling whether they are eligible for the benefit of sub-clause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble on the J-Gate platform by the publisher in terms of the agreement with the Appellant. The publisher provides the content to be hosted on the appellant s portal and grants the appellant permission to display the content and make available the content in searchable format to the appellant s customers. Such open access journals will be available for subscribers even after termination of the agreement with the publisher. The subscriber only pays the subscription amount to the Appellant and is given complete access to the journals on the J-Gate platform during the period of subscription. In this case there is an online supply of journals by the appellant to the educational institution who is the subscriber. 23. In the case of restricted access journals, the subscriber to the J-Gate portal is provided with the details of the journal in summary (metadata) and if the subscriber wants to have access to the full journal, he will be required to pay additional fees to the publishers. In this mode of access, the publisher agrees to host the journal on the J-Gate portal but they want to place restrictions on how their journals are used. Hence to get the full access to the journal, the su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re interested in. The subscriber can get free access to the full text of the article if the same is an open access journal. If the journal is a restricted access journal, then the subscriber will have to pay additional fees to the publisher to gain full access. As already mentioned, the payment of additional fees to the publisher is only to protect the interests of the publisher in how the journal contents are being used. The journal is made available to the subscriber only through the J-Gate platform even after payment of additional fees to the publisher. Therefore, in our opinion, it is the appellant who make the supply of the online journals to educational institutions. 25. The lower Authority has held that the transaction of supply of information by the appellant is a supply of service covered under Heading 998431 whose description is Online text based information such as online books, newspapers, periodicals, directories and the like . It has also been held that the service is taxable to GST at 18% under entry No 22 of Notification No 11/2017 CT (R) dated 28-06-2017. The Appellant has contended that this finding of the lower Authority is beyond the scope of the ruling whic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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