In re Dr. H.B. Govardhan (GST AAR Karnataka)
(a) Is the applicant eligible to be registered under GST Act?
The applicant is providing Business Promotion & Management Services, covered under SAC 9983 and are taxable as discussed at para 11 supra. The applicant being a service provider, as an intermediary, becomes a taxable person and hence is liable for registration in terms of Section 22(1) of CGST Act 2017. Therefore the applicant is liable for registration subject to threshold limit of turnover.
(b) Is there any tax liability on services rendered to the Hospitals/Laboratories/ Biobanks registered in United States of America (USA) and other countries include export of Intellectuals like clinical data completions, analysis, clinical opinion advisory consultation through Phone calls, Video Conference, Mails and other Electronic devices and the applicant is living in India and services rendered from the place of India?
There is no liability of tax on diagnostic and treatment services rendered to Hospitals/ Laboratories/ biobanks registered in United States of America and other countries. However, the business promotion services rendered, as per the contract submitted, are liable to tax under the GST Acts.
(c) Is there any tax liability on Health Care Services-Medical Services and Paramedical Services (Para-time practicing in Clinic) rendered in India to the recipient from India?
The diagnostic and treatment services are covered under Health Care Services and the medical services and part time practising in Clinic are exempted from the payment of GST.
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, KARNATAKA
ORDER UNDER SECTION 98(4) OF THE CGST ACT, 2017 & UNDER 98(4) OF THE KGST ACT, 2017
Dr. Hosahalli Boraiah Govardhan, No.85, Near Corporation Bank, 1st Floor, Magadi Main Road, Anjananagar, Bengaluru 560091, (hereinafter referred to “the applicant”) having GSTIN 29SUOPB7362A1ZO, has filed an application for Advance Ruling under Section 97 of the CGST Act,2017 read with Rule 104 of CGST Rules, 2017 and Section 97 of the KGST Act, 2017 read with Rule 104 of KGST Rules 2017, in FORM GST ARA-01 discharging the fee of Rs.5,000/- each under the CGST Act and KGST Act.
2. The applicant, a proprietary concern, registered under the provisions of the Goods and Services Act, 2017, is a Medical Doctor specialised in Cancer and other General Health Care Services and presently working in KIDWAI HOSPITAL as Salaried Employee and also is rendering Consulting Services to Hospitals/ Laboratories / Biobanks registered in United States of America (USA) and other countries through phone calls, Video Conference, Mails and other Electronic devices. He is living in India and rendering all medical consultancy services from India to Hospitals/ laboratories / biobanks and receives monthly/ quarterly remuneration from USA and other countries in dollars / foreign currency. He has further stated that he desires to practice in India part time and receive consultancy income in India from Indian Hospitals/ Laboratories and health care services.
3. In view of the above, the applicant sought advance ruling in respect of the following questions:
(a) Is the applicant eligible to be registered under GST Act?
(b) Is there any tax liability on services rendered to the Hospitals / Laboratories/ Biobanks registered in United States of America (USA) and other countries includes export of intellectuals like clinical data completions, analysis, clinical opinion advisory consultation through Phone calls, Video Conference, Mails and other Electronic devices and the applicant is living in India and services rendered from the place of India?
(c) Is there any tax liability on Heath Care Services – Medical Services and Paramedical Services (Part-time practicing in Clinic) rendered in India to the recipient from India?
4. Admissibility of the application : The applicant filed the instant application, in relation to requirement of registration and determination of liability to pay tax. Further the applicant has sought advance ruling in respect of the questions on the issues covered under Section 97(2)(e) & (f) of the CGST Act 2017 respectively and hence the application is admitted.
5. The applicant furnished the following facts relevant to the instant application.
5.1 The applicant stated that he is a clinical practitioner involved in supply of Health Care Services to Indian Hospitals and Laboratories and receives consultation fees after deduction of TDS for the said services. The applicant desires to know whether he should get registered under GST and are there any tax liabilities for health care services in India. He also stated that he is giving external health care services to laboratories, hospitals, bio-bank companies situated outside India, either in USA or other countries as Export of Clinical Information Intellectuals, Clinical data completion, data analysis, through electronic devices and getting monthly or quarterly remuneration in dollars depending on his work.
He is desirous to know whether there is a tax liability and whether these services come under GST as it includes health care services outside India and also includes export of intellectuals and getting remuneration from USA in dollars.
PERSONAL HEARING / PROCEEDINGS HELD ON 30.07.2020
6. Dr. H. B. Govardhan, the applicant medical practitioner himself appeared for personal hearing proceedings on 28.07.2020 before this authority and reiterated the facts and submitted as under:
6.1 The applicant is presently a practicing medical doctor and is providing consultation facilities to the patients in India. He is also giving consultation related to diagnosis and treatment of cancer patients referred to by Hospitals, Laboratories and Biobank Companies situated abroad for which he is receiving remuneration based on the work done to them. He is also planning to provide consultation services related to diagnosis and treatment to the Indian Hospitals, Laboratories and Bio-banks in future. The applicant has furnished the copy of Consulting Agreement entered by him with M/s Cureline Inc. USA, schedule ‘A’ of which specifies the list of consultancy services that need to be provided by the applicant.
6.2 The applicant claims that the services provided to the Institute which is a hospital, is exempted from tax under the CGST Act, KGST Act and IGST Act.
FINDINGS & DISCUSSION
7. We have considered the submissions made by the Applicant in his application for advance ruling as well as the submissions made by him when he appeared for the personal hearing. We have also considered the issues involved, on which advance ruling is sought by the applicant, and relevant facts.
7.1 At the outset, we would like to state that the provisions of both the CGST Act and the KGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provisions under the KGST Act.
7.2 The applicant stated that he supplies the diagnostic services to the hospitals, Laboratories and Bio-bank companies. The applicant has also submitted a copy of the consulting agreement entered by him with M/s Cureline, Inc., USA, which reveals that the applicant, during the term of the agreement, shall provide his medical expertise in organising collaborative projects between Cureline Inc and clinical centres located in India, histopathological consulting and business development to Cureline.
7.3 The applicant stated during the physical hearing that he would be receiving the samples, test reports and other laboratory reports on which he would be providing his expert services like diagnosis and treatment. He is required to organize collaborative projects between Cureline and clinical centres located in India and providing histopathological consulting and business development to Cureline for which he would be remunerated.
7.4 From the above agreement, it could be seen that the applicant is providing two types of services – (1) Consultation Services in diagnosis and treatment of illness to the Hospitals, Laboratories and Biobank companies, and (2) Business Promotion Services like organising collaborative projects between the foreign company and the clinical centres located in India and business development for the foreign companies.
8. Regarding the first type of services, i.e. Consultation Services in diagnosis and treatment of illness the following is observed: –
8.1 Entry no. 74 of Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 reads as under:
