In re Protego Services LLP (GST AAR Gujarat)
The Gujarat Authority for Advance Ruling (AAR) addressed the eligibility for GST exemption on transportation and catering services provided by Protego Services LLP (now Protego Services P Ltd) to students of Fountainhead School. Protego Services sought exemption under Notification No. 12/2017-CT(Rate) for services exclusively provided to the school’s students and staff. The core of the applicant’s argument was that these services, despite payments being received directly from parents, should be considered as provided “to an educational institution,” thereby qualifying for exemption. They cited an agreement with Fountainhead Education Trust, which manages the school, asserting that the services were rendered on the school’s behalf, as evidenced by school bus permits obtained for the school’s use and food licenses for the school’s canteen address.
The AAR, however, ruled against the applicant’s claim for exemption. The Authority highlighted that for the exemption to apply under Serial No. 66(b)(i) and (ii) of the notification, the services must be provided to an educational institution. Despite the agreement between Protego Services and the Trust for providing services, the crucial factor was that Protego Services directly collected fees for transportation and catering from the students, not from the school administration. The AAR reasoned that since no consideration was received by the school from the applicant, and payments were directly made by students, the services could not be deemed as provided to the school. Consequently, the primary condition for exemption was not met. The AAR also declined to rule on the refund of tax paid in earlier years, stating that questions concerning refunds do not fall under the scope of advance rulings as defined in Section 97 of the CGST Act, 2017. Furthermore, the AAR rejected the applicant’s request to issue the ruling in the name of the newly converted Private Limited Company, as the application was filed by the LLP.
