In re Be Well Hospitals Private Limited (GST AAR Tamilnadu)
Q1.Whether the Supply of medicines and consumables used in the course of providing health care services to In-patients by pharmacy unit of Be well hospitals for diagnosis or treatment during the patient’s admission in hospital would be considered as *Composite Supply of health care service as under GST and consequently avail exemption under Notification No.12/2017 CT (Rate) read with Section 8(a) of GST?
A1. Supply of Medicines and consumables used in the course of providing health care services to in-patients admitted to the hospital for diagnosis, or medical treatment or procedures till discharge is a composite supply of In Patient Healthcare Service, provided the consolidated bill raised in the name of the patient indicates the supply of medicines and consumables during the course of provision of health care services, as defined in Para 2(zg) of Notification No.12/2017 CT (Rate) as amended and Notification No.II (2)/CTR/532(d-15)/2017 vide G.O. (Ms) No. 73 dated 29.06.2017 as amended and the same is exempted from CGST and SGST as per SI No 74 of the above notifications respectively.
Q2. Whether the supply of medicines and consumables used in the course of providing health care services to out-patients by pharmacy unit of the Be well hospitals for diagnosis or treatment would be considered as “Composite Supply” of heath care services under GST and consequently avail exemption under Notification No.12/2017 CT (Rate) read with Section 8(a) of GST?
A2. Supply of Medicines and consumables used in the course of providing health care services to Out-patients admitted to the hospital for diagnosis, or medical treatment or procedures is not a composite supply and is hence taxable to GST.
FULL TEXT OF THE ORDER OF AUTHORITY FOR ADVANCE RULING, TAMILNADU
Note: Any appeal against the Advance Ruling order shall be filed before the Tamil Nadu State Appellate Authority for Advance Ruling, Chennai under Sub-section (1) of Section 100 of CGST ACT/TNGST Act 2017 within 30 days from the date on which the ruling sought to be appealed against is communicated.
At the outset, we would like to make it clear that the provisions of both the Central Goods and Service Tax Act and the Tamil Nadu Goods and Service Tax Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the Central Goods and Service Tax Act would also mean a reference to the same provisions under the Tamil Nadu Goods and Service Tax Act.
BE WELL HOSPITALS PRIVATE LIMITED, New no.2, old no.5, Vijayaragava road First street, T.Nagar, Chennai-600017 (hereinafter called the Applicant) are registered under GST with GSTIN 33AAECB5775ClZW.The applicant has sought Advance Ruling on the following questions:-
1.Whether the Supply medicines and consumables used in the course of providing health care services to In-patients by pharmacy unit of Be well hospitals for diagnosis or treatment during the patients admission in hospital would be considered as “Composite Supply” of health care service as under GST and consequently avail exemption under Notification No. 12/2017- CT (Rate) read with Section 8(a) of GST?
2 Whether the supply of medicines and consumables used In the course of providing health care services to out-patients by pharmacy unit of the Be well hospitals for diagnosis or treatment would be considered as “Composite Supply” of heath care services under GST and consequently avail exemption under Notification No.12/2017 CT (Rate) read with Section 8(a) of GST?
The Applicant has submitted the copy of application in Form GST ARA – 01 and also submitted a copy of Challan evidencing payment of application fees of Rs.5,000/- each under sub-rule (1) of Rule 104 of CGST rules 2017 and SGST Rules 2017.
2.1 The applicant has stated that they are a chain of multispecialty hospitals providing health care services through establishments in Tamil Nadu and Puducherry. The Be Well Hospitals were established in the year 2011 and headquarters is located in Chennai. The Applicant currently operates 11 hospitals in South India 5 locations in Chennai, Pudukkottai, Sivakasi, Tuticorin, Erode, Nagercoil and Pondicherry. The Applicant has stated that their hospital is established with primary focus on providing access to affordable and quality health care services, including the locations which has limited access to quality healthcare. They are providing “Health care services” in the category such as Emergency care, Multispeciality care and Preventive care. The applicant has stated that in addition to the health care services, they also provide certain other healthcare related services such as healthcare consultancy, corporate services. They provide healthcare service to both domestic as well as international patients. International consultancy services are provided online without any travel assistance. Pharmacy units in each clinical establishment at different locations, supplies medicine to both in-patients and out-patients. Pharmacy charges GST on MRP basis against all the supplies provided to the patients including supplies to inpatients. Currently the pharmacy units at different locations forms part of the clinical establishments in respective locations and have common GST registration for the various branches within Tamil Nadu.
2.2 Healthcare services provided by the applicant:
i. Emergency Care: Emergency Physicians providing first line care, attend Patients with illnesses or injuries requiring immediate medical attention. Investigations will be initiated and interventions are provided to diagnose and treat patients. The emergency staff coordinates Care with physicians from other specialties, and make decisions regarding a patient’s need for hospital admission, observation or discharge. The Applicant offers services day and night so you can stay confident of quick and affordable care, Facilities available with applicant in order to facilitate the emergency care services includes 24 hours Emergency Physicians, BLS trained paramedical staff, Well-equipped triage, Observation bays, dedicated bay to handle patient needing isolation. Exclusive emergency procedure and dressing room, Round-the-clock pharmacy, diagnostic and ambulance services. The specialised emergency care services provided by Applicant includes: Multiple fracture injuries, Burns, Poisoning, Snake bites.
ii. Preventive Health care: Performing regular health check ensures a happier life for the individuals. Support in early detection of worrying changes if any at all, and addressing them with quick interventions. The Applicant has states that they have a range of health check programs right from the basic to the advanced and also have specialised ones for women and geriatric people.
