Andhra Pradesh AAR in the case of M/s. Master Minds

Case Covered:

M/s. Master Minds

Facts of the case:

The applicant herein is a proprietary firm and a leading educational institution providing coaching to students for chartered Accountancy certificate (‘CA’); Cost and Works Accountancy Certificate (‘ICWA) and Intermediate Certificate. The coaching provided by the applicant enables the students to appear for the examinations

conducted by the respective statutory bodies i.e., Intermediate (Higher Secondary Education), Chartered Accountancy Course (consisting of three levels i.e. CA Foundation course (earlier referred as ‘CPT’), CA-intermediate (earlier referred as ‘IPCC’) Course and CA-Final Course), and Cost Management Accountancy (Consisting of three levels i.e. CMA Foundation Course, CMA-Intermediate Course, and CMA-Final Course) and to obtain the necessary qualifications. The applicant’s registration with the service tax department was migrated to GST under the GST Act w.e.f. 01.07.2017. However, on the request of the applicant on the ground that the educational services provided by the applicant were exempted under GST vide entry no 66 of Notification No. 12/2017-Central Tax dated 28.06.2017, the department approved the cancellation of Migrated Registration.

Observations:

We have examined the issues raised in the application. The issues raised by the applicant before us were under litigation since long under the service tax regime as narrated by the applicant in the application. Though we are not concerned with the issues under litigation under the service tax regime, with the identical exemption provided for educational services both under the service tax regime and GST regime and identical issues being presented before the Central Tax authorities in the past, we wish to discuss the proceedings under the service tax regime without ignoring the past history. Accordingly, we do so.

The question basically raised in the proceedings before us and even before the authorities under the service tax regime is whether the coaching provided by the applicant to its students is exempted from GST and service tax as the case may be. The term coaching is no more used in the GST and the supply of the service is the criteria. We understand from the legal provisions, the narration of the issue and the documents submitted by the applicant along with the application that the questions that are to be addressed by us in these proceedings are:

(a) Whether the applicant falls within the definition of the term ‘educational institution’ as defined under Notification No.12/2017- Central Tax (Rate) dt.28.06.2017?

(b) Whether the applicant is supplying the services to the students as an educational institution?

(c) Whether the service of supply of food i.e. catering and accommodation to the students for these courses is exempted under the said notification?

Ruling:

(Under Section 98 of Central Goods and Services Tax Act, 2017 and the Andhra Pradesh Goods and Services Tax Act, 2017)

Question (a): Whether the services of supply of service of education as per the curriculum prescribed by the statutory authorities/ government to the students of the applicant for obtaining qualifications/ certificates of CA-Foundation, CA-inter, CA-Final, CMA (ICWA)- Foundation, CMA-inter, CMA-Final and Intermediate duly recognized by the respective statutory authorities/ government are exempted under Notification No.12/2017-CT (Rate) dt.28.06.2017 (entry no.66(a)), as amended? 

Answer (a): The applicant is not eligible for the exemption under Entry No.66(a) of Notification No.12/2017-CT(Rate) dated 28.06.2017, as amended.

Question (b): Whether the charges collected for providing accommodation to the students undergoing the above courses are exempted from GST as provided under Notification No.12/2017-CT (Rate) dt.28.06.2017 (entry no.14), as amended read with Circular No.32/06/2018-GST dt.12.2.2018 since the amount charged from the students by the hostel run by the applicant is less than Rs.1000/- per day?

Answer (b): The applicant is not eligible for the exemption under Entry No.14 of Notification No.12/2017-CT(Rate) dated 28.06.2017.

Question (c): Whether the charges collected by the applicant for catering service by supplying food to the students undergoing the above courses are exempted from GST as provided under Notification No.12/2017-CT (Rate) dt.28.06.2017 (entry no.66(a)), as amended?

Answer (c): The applicant is not eligible for the exemption under Entry No.66(a) of Notification No.12/2017-CT(Rate) dated 28.06.2017.

Read & Download the Full Decision in pdf: