Telangana GST AAR Denies Tax Exemption on Pure Services from Sellers By AIIMS

All India Institute of Medical Sciences (AIIMS) can claim GST Exemption on pure services obtained from Vendors, Telangana Authority of Advance Ruling (AAR) held.

The bench of S.V. Kasi Visweswara Rao and Sahil Inamdar noted that the petitioner is not the Central Government but a “Governmental Authority” as it is made via the Government by the Act of Parliament.

The GST exemption Notification 12/2017 was revised from 01.01.2022 and omitted the phrase Governmental Authority from the description of the services. The applicant is not qualified for exemption.

The petitioner, AIIMS is one of the newest additions to the prestigious All India Institute of Medical Sciences (AIIMS) network in India, located in Bibinagar, a town in the Yadadri Bhuvanagiri district of the Indian State of Telangana, AIIMS Bibinagar was established to address the growing demand for high-quality healthcare, medical education and research in the region.

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AIIMS Bibinagar, similar to its counterparts, is dedicated to delivering top-tier medical education and training programs.

It seeks to deliver skilled healthcare professionals who meet the nation’s evolving healthcare demands. The institution is provided with modern infrastructure and state–of–the–art facilities for medical education.

AIIMS, an institution committed to healthcare and education, has joined into contracts with distinct entities for services. AIIMS is paying GST at a rate of 18%. But, in compliance with the provisions of the GST Act, it is reversing the whole Input Tax Credit (ITC) claimed via us as they are furnishing exempt services.

The GST paid to vendors is therefore remitted to the Government, and the same in turn, supports the organization financially.

The petitioner seeks for an advance ruling on the problem of whether All India Institute of Medical Sciences can avail the GST Exemption on pure services received from Vendors.

AAR ruled that GST must be paid via AIIMS on the complete service that the vendors provided since the same is a Governmental authority.