Applicability of GST on vaccination done by doctors in their clinic (OPD)

In re Anju Parakh (GST AAR Chhattisgarh)

Vaccines sold/supplied through a separate chemist shop /pharmacy store owned by the clinic/hospital across the counter would be subjected to GST as supply of good, at the applicable rate of GST.

In the case where the clinic/hospital itself has divided the contract into two parts one for supply of healthcare services and the other for supply/sate of vaccines, then such supply/ sale of vaccines across the counter would be subject to GST, there being no single and “composite contract for the said supply.

When the supply of vaccines is used in the course of providing health care services to the patients for treatment, the same being naturally bundled and being provided in conjunction with each other would be considered as “composite supply” there by becoming eligible for exemption as stipulated under sr.no. 74 of Notification no. 12/2017- Central Tax (Rate) dated 28.6.2017 under the category of health care services the pre-dominate factor being rendering of health care services.

FULL TEXT OF THE ORDER OF AUTHORITY FOR ADVANCE RULING, CHHATTISGARH

The applicant Snit. Anju Parakh (herein after also referred to as the applicant) has filed an application U/s 97 of the Chhattisgarh Goods & Services Tax Act, 2017 requesting an advance ruling on applicability of GST on vaccination done by doctors in their clinic (OPD).

2. Facts of the case:-

i. The applicant Smt, Anju Parakh is a practicing paediatrics registered in Raipur circle-1 with GSTIN- 22AESPP0220P1 ZB. The applicant undertakes the work of vaccination to the children coming in their clinic.

ii. The applicant charges fees for the above vaccination work provided to the children,

3. Contentions of the Applicant:-

The applicant contended that they are eligible for exemption as regard the facility of vaccination done by them in their clinic, claiming the same to be covered under health care services.

4. Personal Hearing:-

Keeping with the established principles of natural justice, personal hearing in the matter was extended to the applicant and accordingly their authorized representative Shri Rajkumar Parakh, husband of the applicant appeared before the authority for hearing on 12.03.2020 and reiterated their contention. He also furnished a written submission dated 12,03.2020 which has been taken on record.

The applicant sought advance ruling on applicability of GST On vaccination done by doctors in their clinic (OPD). In this regard, Shri Parakh reiterated that as the said vaccination in OPD is done by doctor;, it should be covered under health core services. To bring home his point, he submitted 0 copy of abstract from “Childhood vaccination a guide for Pediatrician” edited by A.K. Dutto (Emeritus consultant in Pediatrics, Indraprostha Apollo Hospital, New Debi).

5. The legal position, Analysis and Discussion:-

5.1 The provisions for implementing the CGS1 Act and CGGST Act, 2017 are similar. Now we sequentially discuss the provisions that ore applicable in the present case.

5.2 The applicant sought advance ruling on applicability of GST on vaccination done by doctors in their clinic (OPD).

5.4 Notification No.1 /2017-CT(Rate) dated-28.06.2017 :-

Serial no.174 of above Notification no. 1/2017-CT(Rate) dated-28.06.2017, under chapter/heading 3002, 3006 stipulates the rate of GST on animal or human blood vaccines as 5% GST.

5.5 Notification No 12/2017-CT(Rate) dated-28,06.2017 :-

The Central government vide Notification no. 12/2017-CT(Rate) dated-28.06.2017 nas exempted the intrastate supply of services by way of health care services by a clinical establishment, an authorized medical practitioner or para-medics from the GST liability, vide serial no. 74 under heading 9993 of the above notification. For the sake of brevity the text of the Notification is reproduced hereunder:-

Notification No. 12/2017- Central Tax (Rate)

New Delhi, the 28th June, 2017

G.S.R.. (E).- In exercise of the powers conferred by sub-section ( 1 ) of section II of the Central Goods and Services tax Act, 2017 (12 of 2017), the Central Government, on being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council, hereby exempts the intra-State supply of services of description as specified in column (3) of the Table below from so much of the central tax leviable thereon under sub-section (1) of section 9 of the said Act, as is in excess of the said lax calculated at the rate as specified in the corresponding entry in column (4) of the said ‘table. unless specified otherwise, subject to the relevant conditions as specified in the corresponding entry in column (5) of the said Table, namely:-

5.6 Vide Circular No-27/01/2018-GST doted-04.01.2018 it has been clarified that the rent on rooms provided to in patients in hospital is exempt from GST.

5.7 Point no. 5 of Circular No-32/06/2018-GST dated-12.02.2018 clarified that

(a) the services provided by senior doctors/ consultants/Technicians hired by the hospitals whether employees or not, are health care services and are exempt from GST.

naturally bundled and being provided in conjunction with each other would be considered as “composite supply ” eligible for exemption as stipulated under sr.no.74 of notification no 12/2017-Central Tax (Rate) dated 28.6.2017 under the category of health care services. Thus the determinant factor would be whether the supply is for providing health care services or across the counter sale. In case the same is across the counter sale as supply of good arises no question of any exemption from GST.

In view of the deliberations and discussions as above, we pass the following order:-

ORDER

(Under section 98 of the Chhattisgarh Goods and Services Tax Act, 2017)

No. STC/AAR/02/2020

Raipur Dated …09/06/2020

The ruling so sought by the Applicant is accordingly answered as under:

Vaccines sold/supplied through a separate chemist shop /pharmacy store owned by the clinic/hospital across the counter would be subjected to GST as supply of good, at the applicable rate of GST.

In the case where the clinic/hospital itself has divided the contract into two parts one for supply of healthcare services and the other for supply/sate of vaccines, then such supply/ sale of vaccines across the counter would be subject to GST, there being no single and “composite contract for the said supply.

When the supply of vaccines is used in the course of providing health care services to the patients for treatment, the same being naturally bundled and being provided in conjunction with each other would be considered as “composite supply” there by becoming eligible for exemption as stipulated under sr.no. 74 of Notification no. 12/2017- Central Tax (Rate) dated 28.6.2017 under the category of health care services the pre-dominate factor being rendering of health care services.

Place :- Raipur

Date:-