GST Case 2- Indian Institute of Management
GST Case 2- Indian Institute of Management
Following the GST case of Indian Institute of Management in which the tax liability of certain supply is questioned:
Query: After the introduction of the IIM Act w.e.f. 31st January 2018, whether or not the Applicant should be considered an “Educational Institution” and since exemptions under both Entry Nos. 66(a) and 67 are now available, Applicant should be allowed to claim exemption under Entry No. 66(a), being more beneficial having a broader ambit.
Facts: Prior to 31st January 2018, IIM, Kolkata was a “Society” under the Societies Registration Act, 1860. After enactment of IIM Act, IIM is eligible to grant degrees, diplomas and other academic distinctions or titles and to institute and award fellowships, scholarships, prizes and medals, honorary awards and other distinctions under Section 7 of the IIM Act.
The Applicant has stated to have been providing different programmes such as Post Graduate Programme (PGP) for 2 years term, Post Graduate Programme for Executives (PGPEX) for one year term, Fellow Programme etc. These courses were not exempted from the levy of GST as Entry No. 67 of the Exemption Notification, specifically excluded these courses from the purview of exemption. Further, these courses were not covered under Entry 66(a) as these degrees/programmes were not recognized and approved under UGC Act or AICTE Act.
Observation: The Apex Court has settled the law that if benefits under more than one provision are lawfully available, assessee can enjoy the one more beneficial to him. [Collector of Central Excise –.v- Indian Petro Chemicals [1997] 92 ELT 13 (SC); HCL Ltd –v.- Collector of Customs [2001] 130 ELT 405 (SC); Commissioner of Central Excise and Service Tax –v.- Orient Bell Ltd (CEA – 65/2016 before the High Court of Karnataka); Winsome Yarns Ltd (Excise Appeal No. 55317-55318 of 2013 before CESTAT, Delhi)]
Held: Hon’ble AAR held that after 31st January 2018, IIM is an “Educational Institution” within the meaning of sub-clause (ii) of clause 2(y) of the Exemption Notification as an institution providing services by way of education as a part of a curriculum for obtaining a qualification recognised by any law for the time being in force.
Exemption under Entry no. 66(a) is applicable to such educational institutions as such, especially as the law mentions that the qualifications awarded are to be “recognised by any law for the time being in force”. Entry No. 67 specifically concerns IIMs but only for courses mentioned therein, will be eligible for Exemption under the specific entry, even if not mentioned elsewhere under any law for the time being in course. The court, including the apex court, settles that if benefits under more than one provision are lawfully available, the assessee can enjoy the provision more beneficial to him.
Impact: Hon’ble AAR relying upon the judgements of Hon’ble Apex Court has held that if exemption under more than one provision are lawfully available, the assessee can enjoy the provision more beneficial to him.
CA Arpit Haldia
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