The GST Authority for Advance Rulings (AAR), Rajasthan, has clarified that the treatment of outpatients with substance abuse disorders does not fall within the scope of “healthcare services” exempt from GST. This ruling was made in response to the case of Allopathic Sanjeevani Psychiatric Clinic, which offers a range of services including psychotherapy, medical evaluations, and medication prescribed by psychiatrists.
The clinic presented information to the AAR, emphasising the importance of doctor assessments in treating substance abuse disorders and stating that additional elements like counselling and medication administration are essential to the treatment process. The clinic further explained that the prescribed medications are considered “controlled drugs” and are administered within the clinic, making it an integral part of the treatment and not a separate supplier.
The AAR bench noted that the clinic provides both products (medicines) and services (medical evaluation and advice). While medical services are generally exempt from GST, with hospitals’ provision of medications falling under the composite supply of medical services, in this particular case, the bench concluded that the medications given by the clinic to outpatients do not qualify for tax exemption as part of a composite supply.
The bench also emphasised that the treatment of substance abuse disorders is distinct from mental health services and does not fall under the purview of the GST exemption notification.
| Applicant Name | Sanjeevani Psychiatric Clinic |
| Advance Ruling No. | RAJ/AAR/2023-24/01 |
| Date | 25.04.2023 |
| Rajasthan GST AAR | Read Order |
