GST on supply
of various services by Central and State Board (such as National Board of Examination)
The Goods and
Services Tax Act, 2017 came into force in India with effect from 1.7.2017.
The Central Government
has clarified about the applicability and non-applicability of GST in respect
of examinations conducted vide Notification No.151/07/2021-GST dated 17.6.2021
the following:
· GST is exempt on services
provided by Central or State
Boards ( including the
boards
such
as NBE) by way of conduct of
examination for the students, including
conduct of entrance examination for admission to
educational institution [under
S. No. 66 (aa) of notif No. 12/2017-CT(R)]. Therefore, GST shall not apply to any
fee or any amount charged by such
Boards for conduct
of such examinations including entrance
examinations.
· GST is also exempt on input services relating to admissionto, or conduct of examination, such as online testing service, result publication, printing of notification for examination, admit card and questions papers etc, when provided to such Boards [under S. No. 66 (b) (iv) of notif No. 12/2017- CT(R)].
· GST
at the rate of 18% applies to other services provided by such
Boards, namely of providing accreditation to an institution or to a professional (
accreditation
fee or registration fee such as fee for
FMGE screening test )
so as to authorise them
to provide their respective
services
The relevant
Circular is given below for ready reference:
CBIC-190354/36/2021-TRU
Section-CBEC
Government of
India Ministry of Finance
Department of Revenue
*****
North Block,
New
Delhi, Dated the 17th June,
2021
To,
The Principal Chief Commissioners/
Chief Commissioners/
Principal
Commissioners/ Commissioner
of Central Tax (All) /
The Principal Director Generals/ Director Generals (All)
Madam/Sir,
Sub– Clarification
regarding GST on
supply of various services by Central and State Board
(such as
National Board of Examination)–reg.
Certain representations
have been received seeking clarification in respect of
taxability of various services
supplied by Centre and State Boards such as National
Board of Examination
(NBE). These services include entrance examination
( on
charging a
fee)
for admission to educational institution,
input services for conducting such
entrance examination
for students, accreditation of
educational institutions
or professional so as to authorise them
to provide their respective
services. The issue was examined by GST Council in its 43rd meeting held on 28th May, 2021.
2. Illustratively, NBE provides services of conducting entrance examinations for admission
to
courses including Diplomat National Board (DNB) and Fellow
of National Board
(FNB), prescribes courses and
curricula for PG medical studies,
holds examinations and grant degrees, diplomas and
other academic distinctions. It
carries out all functions as are normally carried out by central or
state educational
boards and is thus a central
educational board.
3. According to explanation 3(iv) of the notification No. 12/ 2017 CTR, “Central and State Educational Boards” are treated as Educational Institution for the limited purpose of providing services by way of conduct of examination to the students.
Therefore, NBE is an ‘Educational Institution’ in so far as it provides services by way
of conduct of
examination, including
any entrance examination, to the students.
3.1 Following services supplied by an educational institution are exempt from
GST vide sl.
No.
66 of the notification No. 12/ 2017-
Central
Tax
(Rate)
dated
28.06.2017,
Services provided -
(a) by an educational institution to its students,
faculty
and
staff;
(aa) by
an educational
institution by
way of conduct of entrance
examination against consideration in the form
of entrance fee;
3.2 Similarly, services
provided to an
educational
institution, relating
to
admission to, or conduct of examination is also exempt from GST [sl. No. 66 (b)(iv)-
12/2017-CT(r)].
3.3 Educational institutions are defined
at 2(y) of the said notification as follows-
“(y) educational
institution” means an institution providing services
by way of, -
(i) pre-school
education
and education up
to
higher
secondary
school or
equivalent;
(ii) education as a part of a curriculum for obtaining a qualification recognized by any law for
the time being in force;
(iii) education as a
part of an approved
vocational education course;”;
Further, clause (iv) of Explanation
of said notification reads as below:
“(iv) For removal of doubts, it is clarified that the Central and State
Educational Boards shall be treated as Educational Institution for the limited purpose of providing services by way of
conduct
of examination to the
students”
4. Taking into account the above, the GST Council has recommended, to clarify
as below:
(i) GST is exempt on services
provided by Central or State Boards
( including
the boards
such
as
NBE)
by way of conduct of
examination for the students, including conduct of
entrance examination for admission to
educational institution [under
S. No. 66 (aa) of notif No. 12/2017-CT(R)]. Therefore, GST shall not apply to any fee
or
any amount charged by such Boards for conduct of
such
examinations including
entrance examinations.
(ii) GST is also exempt on input services relating to admission to, or conduct
of examination, such as online testing service, result publication, printing
of notification for examination, admit card and questions papers etc, when
provided to such Boards [under S. No. 66 (b) (iv) of notif No. 12/2017-
CT(R)].
(iii) GST at the rate of 18% applies to other services provided by such
Boards, namely of
providing accreditation to an institution or to a professional (
accreditation fee or
registration
fee such
as fee for FMGE screening test )
so as to authorise
them
to provide their respective
services
5. Difficulty if any, in the implementation of this circular may be brought to the notice
of the Board.
Yours faithfully,
(Rajeev Ranjan)
Under Secretary, TRU
Email: rajeev.ranjan-as@gov.in
Tel: 011 2309 5558
